FINM202 Financial Management Assessment 3 Group Report

COURSE: Bachelor of Business / Bachelor of Accounting

Unit:

Financial Management

Unit Code:

FINM202

Type of Assessment:

Assessment 3 – Group Report (4-5 students in a group)

Length/Duration:

2,000 words (excluding executive summary, table of content, heading & subheading, references, appendix & tables)

Unit Learning

Outcomes addressed:

Understand the basic concepts and theories of financial management.

Explain the goal of financial decisions and the importance of financial information.

Calculate financial ratios and interpret the outcome.

Examine financial instruments and their valuation.

Relate time value of money, risk and return and cash flow to making informed business decisions including capital budgeting.

Prepare and develop a working capital management plan.

Evaluate the concept of optimal capital structure

Assessment Task:

Written Report

Total Mark:

100 marks

Weighting:

20%

You have been working for the investment company. Recently your company has identified a group of potential clients who are interested in investing in shares but feel not confident due to lack of knowledge in the share market. So your boss has requested you to prepare a business report for those potential clients so that they can see/learn:

A. In a long-term, statistics show that the average return on shares is always positive and shares with higher risk can yield higher return;

Two examples of previous successful investment portfolios of your company; and B.

C. Types of risks (systematic and unsystematic) and why diversification strategy is important using the two examples shown in part B.

Below table shows the of what you need to discuss in your report.

Part

Task

Note

A

Basics terminologies of the Australian share market (ASX All Ordinaries, S&P/ASX200, CPI)

Construct of a table showing ASX all ordinaries, S&P/ASX200, and CPI index over the last 5 to 10 years.

Calculate the cumulative return for ASX all ordinaries and S& P/ASX200 over the last 5 to 10 years.

Calculate average nominal and real return for ASX all ordinaries and S&P/ASX200 over the last 5 to 10 years.

Calculate standard deviation of ASX all ordinaries and S& P/ASX200 index over the last 5 to 10 years.

Discuss that the average return on shares is always positive and shares with higher risk can yield a higher return.

Resources for part A will be provided in Moodle “Assessment 3” section.

B

Each member creates an account in the ASX homepage and participates in the share market game.

Play the game until week 9 and include a screenshot of the dashboard (clearly showing your name and your portfolio performance) of each member in the appendix of your report.

Choose the best two portfolios and include those two portfolios in the report as two examples of successful share investment cases of your company

Give a brief explanation about the two investment portfolios (ex, amount of investment, shares purchased, total return, etc.)

Detailed instructions for the share market game will be provided in Moodle “Assessment 3” section.

C

Discuss different types of risks (systematic and unsystematic) with examples.

Discuss how diversification strategy is related to the risks.

Discuss why diversification strategy is important using the two examples shown in part B.

Give real examples of the two types of risk.

Explain how diversification improved the return of the two investment portfolios shown in part B.

Marking Criteria

Lecturer Expectation

Marks

Comments

Part A (35/100)

Basics terminologies of Australian share market

5

ASX All Ordinaries, S&P/ASX200, CPI

Construct of a table showing ASX all ordinaries, S&P/ASX200, and CPI index over last 5 to 10 years.

5

Calculate the cumulative returns

5

Calculate average nominal and real return

5

Calculate standard deviation of ASX all ordinaries and S&P/ASX200 index over last 5 to 10 years.

5

Discuss that the average return on shares is always positive and shares with higher risk can yield higher return.

10

Part B (20/100)

a screenshot of the dashboard of each member in appendix of your report.

5

Show your name and your portfolio performance

Two investment portfolios are included in the report as examples of successful share investment cases

5

Brief explanation about the two investment portfolios

10

amount of investment, shares purchased, total return, etc.

Part C (20/100)

Discuss different types of risks (systematic and unsystematic) with examples.

5

Discuss how diversification strategy is related to the risks.

5

Discuss why diversification strategy is important using the two examples shown in part B.

10

Report Format (15/100)

Executive Summary

4

A brief summary of each section of the report

Table of contents

3

Sub-headings

4

Appropriate use sub-headings to make the report easier to understand.

Conclusion

4

Good summary. No new ideas should be introduced in conclusion.

Referencing (10/100)

Harvard Referencing

5

Proper Referencing Style

5 Academic references

5

Word limit

1800 - 2200 words

Penalties may apply