Investment Plan: Return and Risk

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The statement of the goals and objectives of an investment is important in evaluating the viability of an investment plan. Specifically, an investment policy statement states the strategies that will be used in the achievements of the investments goals and objectives (Tang & Mitchell, 2016). My goal is to start an investment of one million US Dollars in opening a retail store (supermarket) in an urban market. The returns of this investment are high because of the large number of people in such areas. Additionally, the profits will be huge considering the strong public relations team that I have. More importantly, the low number of risks makes my investment viable. Specifically, although there is competition from other stores, there is a huge number of customer clientele that is enough for all the stores. The reason as to why I chose this goal is due to the increasing demand for consumables in the up-market. Specifically, the residents of urban areas have to buy commodities from the stores. As such, my goal is to offer them those commodities at a cheap and stable price.

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Analysis of Risk Tolerance

My investment has a very high-risk tolerance because of several reasons. First, I am willing to spend a lot of money in the start of the investment due to initial capital, costs of advertising and other overheads that are associated with venturing into a new market. However, in the end, I will be able to recoup those expenses. Secondly, the risks that exist in this market are few. As such, there is no much fear on the probability of losing my investments.

Analysis of Assets and Economic Situation

The availability of assets makes my investment plan more feasible (Bergen, 2007). In this regard, I have enough resources to buy stock and other assets that are required in executing the investment goals. Additionally, I can get a treasury bond so that I can be able to improve my business. In the end, I will be able to be self-sufficient without the needs for any bills and bonds. Although the economic situation is not good, I am prepared for any eventualities.

Investment Strategy and Asset Allocation

The buy and hold strategy is the method that I intended to apply (Vanguardlearning, 2016). In this regard, I will buy assets and when their values are depreciating and sell them when their value appreciates. The other strategy that I will use is the insurance of the assets. In this case, in case of drastic depreciation, I will be sufficiently compensated.

Investment Implement Plan

In implementing my plan, I would identify the major risks that are likely to be shoot-down my plan. Secondly, I will devise the measures of mitigating those risk factors. The risk controls and management information will be important. Thirdly, I will ensure that I balance the goals of the investment and the needs of the customers. Finally, I will start the buying of assets and installation of the necessary implements for the start of the business.

Benchmark or Return Goal

I will benchmark my investment against the best-performing businesses in the urban area. This benchmark will include the risks, the profitability and the purchasing trends of the customers. From benchmarking, I will be almost certain of the returns of my investment within a set period. Additionally, I will get a practical example of the nature of the market before I implement my plan.


Bergen, J. (2007). 6 Asset Allocation Strategies That Work | Investopedia. Investopedia. Retrieved 20 February 2016, from

Tang, N., & Mitchell, O. (2016).The Efficiency of Pension Plan Investment Menus: Investment Choices in Defined Contribution Pension Plans. SSRN Electronic Journal.,. (2016).

Implement the investment plan for your client | Vanguard. Retrieved 20 February 2016, from

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