Investments - Mutual Funds Fact - Assignment Example

Some of the advantages I shall enjoy include dividends from the companies. The common stock will account for 20,000 because: Source of income as dividends. Growth potential if the company splits its common stock to satisfy a large part of its financial needs'. 10,000 shall go into preferred stock as such shareholders receive dividends before common stockholders are paid any cash. This is especially so when corporations are experiencing financial problems. I wish to invest both in corporate and governments bonds.

It is a written pledge to repay a specified sum of money a government to corporate with interest. When I buy a bond I will be loaning a government or corporate money for a given period. The period may extend between 1-30 years. I have two options: to keep them until maturity or redeem them to another investor. Corporate bonds shall be in Celso Corporation, D&E Corporation, and Alexander & Baldwin. Choosing blue-chip stocks is a safe investment that generally attracts conservative investors.

Some of the respected companies incorporate America includes AT&T, general electric, and Kellogg. I will carefully look out for leadership in the industrial group, history of stable earnings, and consistency in paying dividends. These corporate bonds shall take 20,000 i.e. AT&T (8%), General Electric (91%), and Kellogg (3%). The Equity stocks shall include Dow Chemicals, Myers Squibb, and Royal Dutch/ shell in an equal ratio of the 20,000. The main object for such investing shall be income, getting higher dividends than average ones.

In case of a defensive stock that could be included on the portfolio then Proctor and Gamble, Kellogg shall be good bets. A consistent dividend payout. My understanding of different investments in relation to risk depicted by the table below. Buying stocks in a corporation listed in exchange allows ownership and participation in the success of the corporations. I will get an opportunity to sell and repurchase at later date possible at a high price, therefore, getting capital gains. I wish to invest both in corporate and governments bonds.

It is a written pledge to repay a specified sum of money a government to corporate with interest. When I buy a bond I will be loaning a government or corporate money for a given period. The period may extend between 1-30 years.