Investment Objectives

Investment Objective

Our group’s investment objective is to maximize the return by trading and speculating in the US market through different investment vehicles and meanwhile keep up our portfolio’s minimum return with the performance of S&P 500 Index. While deciding our investment objective we considered several constraints such as we have a relatively short term horizon (less than 2 months) and our investment need to be within a confined investment area (stocks, bond mutual funds& ETFs only) so we would like to take a little bit more risk in order to get a more juicy return. So we will pay relatively more attentions on small and medium stocks as their prices are expected to be more volatile and they tend to yield more and also have a better chance to arbitrage. We will also use margin in trading in order to magnify the profits. Nevertheless we might also short the stocks at the right timing to get advantage of the volatile price. Our degree of risk might be slightly higher but we will go for it and try our best to maximize the return of our investment.

Benchmark:

To make sure the market returns are on track we will use Standard & Poor’s 500 Index as a benchmark. S&P is a good benchmark in this case as we are investing in a diversified portfolio of different sizes of stocks in different industries.

Year |   Beginning Price |   Ending Price |   Gain or Loss |   Percent Gain or Loss |

2001 | 1320.28 | 1148.08 | -172.20 | -13.04% |

2002 | 1148.08 | 879.82 | -268.26 | -23.37% |

2003 | 879.82 | 1111.92 | 232.10 | 26.38% |

2004 | 1111.92 | 1211.92 | 100.00 | 8.99% |

2005 | 1211.92 | 1248.29 | 36.37 | 3.00% |

2006 | 1248.29 | 1418.30 | 170.01 | 13.62% |

2007 | 1418.30 | 1468.36 | 50.06 | 3.53% |

2008 | 1468.36 | 903.25 | -565.11 | -38.49% |

2009 | 903.25 | 1115.10 | 211.85 | 23.45% |

2010 | 1115.10 | 1257.64 | 142.54 | 12.78% |

2011 | 1257.64 | 1257.60 | -0.04 | -0.00% |

According to the statistic above, the minimum gain...