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Examples of Portfolio Planning

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Justify the assembly of a balanced product portfolio by marketing managers as a means of ensuring extended success in the health care market industry. Provide two (2) real-life examples to support your rationale.

Assess the importance of portfolio planning in the health care industry, and determine at least one (1) approach to portfolio planning that can help marketing managers to ensure productive marketing operations. Provide at least two (2) specific examples of portfolio planning in a health care organization with which you are familiar.

Solution Summary

This solution provides a review to analyze the approaches of two different healthcare organizations and the different strategies they used for portfolio planning and offerings strategies.

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Investment Fundamentals and Portfolio

1. Explain the differences between a market order and a limit order for securities.

2. You have identified a stock through the process of stock screening. Define stock screening. List several sources you might access to find information about the stock you identified.

3. Name four different types of expenses that investors incur associated with their investing activities.

4. List five advantages of marketable securities over investments in real assets.

5. Alma Hatch, a securities analyst, has been studying the stock of XYZ Inc. She has estimated that the stock will have the following possible returns and the probabilities associated with those returns:
Return Probability
-0.15 0.10
-0.05 0.20
0.05 0.35
0.15 0.25
0.25 0.10
1. Compute the expected return on XYZ stock.
2. Compute the standard deviation of returns on XYZ.
3. Would you expect the return on the riskless security to be less than, equal to, or greater than the return you computed in part a?

6. Explain the product life cycle and its use in industry analysis.

7. A company has an 8 percent, 10-year bond outstanding with a yield to maturity of 7 percent. The bond is callable at its next interest payment date. If the bond were not callable, its yield would be 6 percent. Evaluate whether an investor should expect this bond to be called.

8. Explain how stock splits and stock dividends affect the prices and valuation of stocks.

9. Define the three approaches to securities analysis and give an example of using each one.

10. Using the information provided below, evaluate the position of Gramco Inc. compared to its industry with respect to its management of inventory, credit rating, and management of accounts receivable. Identify the ratios you use for each of the comparisons.
Ratio Gramco Inc. Industry
Current ratio 2.3 2.2
Receivables turnover 6.4 6.8
Inventory turnover 5.2 7.5
Total asset turnover 3.1 4.9
Net profit margin .032 .031
Leverage 1.5 1.4
Interest coverage 3.7 3.3
Institutional ownership .15 .31

11. Define the principle of diminishing marginal utility of wealth. Explain how the principle leads to the conclusion that investors are risk averse.

12. Identify factors that investors should consider when making the asset allocation decision.

13. Explain how portfolio risk falls when securities in the portfolio have uncorrelated returns.

14. Distinguish among risk-seeking, risk-indifferent, and risk-averse individuals.

15. Describe the four phases of the portfolio management process.

16. Define the three forms of market efficiency.

17. Define the Sharpe, Treynor, and alpha measures of investment portfolio performance.

18. Identify the three principal approaches to portfolio monitoring and revision.

19. Differentiate between an open-end and a closed-end investment company.

20. Identify the advantages that investment companies offer individual investors.

21. Define the two main types of pension plan.

22. Outline the types of expenses paid by investment companies.

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