Answer to Question #83745 in Finance for jeremy day




 Jan is risk-averse, but wants to earn the best rate of return in less than two years. Which investment would MOST LIKELY meet Jan's need?
If Jan is risk-averse, but wants to earn the best rate of return in less than two years, then certificates of deposit would most likely meet Jan's need.
first, thank you for serving our nation.


second, it will be important to understand your stage in life. presumably, you may be turning 19 after your a-levels or 20 after your poly studies. either way, you are young and have a long investment runway ahead of you.


third, where can you place your money while you serve the nation for the next two years?


www.squirrelsave.com.sg


assuming you can get emergency funding if needed from your parents, then you must decide the risk you want to take in placing the money.


the safest (lowest risk) with no return is to literally keep your money in the safe. that’s not the best way frankly when there are slightly riskier ways to grow your money with decent returns.


one possibility is to place into a bank savings account in singapore, preferably in a fixed deposit which offers a higher return than the basic savings account.


however, i would recommend investing in a well-diversified global portfolio, especially when you have two years of runway to grow your money. after all, it will be good to have good returns after you complete your national service to help you meet expected expenses when you further your studies or take a well-deserved holiday.


investing globally is easy with robo-advisers. pick one which is fully automated where you don’t have to make decisions except how much to invest. in selecting the robo, check if the risk management is done by machine learning ai or if it is managed ultimately by a human manager. diversification requires massive data analytics, which is not humanly possible. yet it is easily done with the computing power available today.


before you start, you need to know or select your own risk profile. it is not easy as most people do not do what they say. further, conventional risk profiling poses technical questions which some people may not fully understand. instead, look for risk profiling tools which reflect your personality and risk-reward behaviour. using such a tool that can analyse your risk-reward attitude is a critical step to start your investing journey.


www.squirrelsave.com.sg a sum of money becomes 3 times in 5 years at simple interest. in how many years will the same sum become 6 times at the same rate of simple interest? what’s your day rate. apple: top few most valuable companies in the world. amazing products. doing interesting work in several fields. could stop selling product for years and still be solvent.alipay: rapid growth, large but niche market. chinese owned. pre ipo so your options are worthless. about ready to ipo so probably really diluted too.lyft: lower comp, smaller and niche market. dependent on gig workers to provide labor. long term outlook?really depends on what you want, but unless one of the others really interests you for some reason, go with apple for a while. probably better comp, looks great on resume. it is a good option start paying attention and thinking about your targeted retirement balance. set a goal and an allocation and rebalance regularly to stay on track and mitigate risk. how does predicting how well a company will do during a year correlate to “best company to work for”? answer: `1.00` in 1 out of 10 days the portfolio value will decline by usd 500000 or more 1. the expected pay-out on each policy is 250 * 1/90 + 12000 * 1/100 + 17000 * 1/400 = $165.  so that's what the premium would have to be in order to get a profit of 0.
 
2. the profit per policy is the premium the company receives minus the expected payout = 350 - 165 = $185.
 
3. the expected profit on 375 policies would be 375 * 185 = $69375