Investment Philosophies Project

The ultimate grading for this course will rest on a prospectus that each group will prepare. In the prospectus, you will lay out your investment philosophy and how you plan to put it into practice. In particular, as a potential investor in the fund that you are starting, I will be looking for the following –

1. What is your investment philosophy and how is it related to your view of how markets work?

2. How do you propose to convert this investment philosophy into an investment strategy or strategies?

3. What specific constraints would you put on yourself? For instance, are there certain types of investors you would want investing in fund and certain types of investors you would dissuade from investing? Is there a minimum size for your fund to be viable? Is there a maximum size beyond which your fund will no longer be viable?

4. Is there any evidence you can point to, either that you have done or others have done, that would suggest that your investment strategy will work?

5. How would you go about back testing this strategy? (Set up the test even if you cannot get your hands on the data. If you can, you will get extra credit fro actual back testing)

6. How would you propose that you should be evaluated? (How often? On what yardstick?)

7. Based upon your investment strategy, develop a portfolio of at least 25 stocks that you would hold right now.