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Investment Portfolio

10. Analyze the "expert's" answers to the following question:

a. Question: I have approximately one-third of my investments in stocks and the rest in a money market. What do you suggest as a somewhat safer place to invest another one-third. I like to keep one-third accessible for emergencies.
Expert's Answer: Well, you could try one-or-two year treasury bonds. You'd get a little bit more yield with no risk.
b. Question: Where would you invest if you were to start today?
Expert's answer: That depends on your age and short-term goals. IF you're very young?say, under 40?and you don't need the money you're investing for a home or college tuition, I'd put it in a stock fund. Even if the market tanks, you have time to recoup. And, so far, nothing has beaten stocks over a period of 10 years or more. But if you're going to need money fairly soon, for a home or for your retirement, you need to play it safer.

Solution Preview

a. Investing in Treasury bonds is good advice as this is one of the safest investments a person can make. Another area of investment that would also carry minimal risk and a higher yield would be certificates of deposits as these make money inaccessible for a couple of months at a time ...