Direct Investment

RMIT Classification: Trusted BAFI 1014




Topic 3
Direct Investment


Financial Planning – Chapters 4,5& 6

, Learning Objectives
RMIT Classification: Trusted BAFI 1014



1. Principles of investing
2. Asset classes and investment products
-Cash
-Interest bearing investments
-Property
-Equities
3. Investment Approaches
4. Considerations when making investment
decisions

, Principles of Investment: BAFI 1014
RMIT Classification: Trusted




Investment objectives & strategies
Objectives:
– represents the desired outcome in a specified time frame:
• people differ in their objectives
• people’s objectives can be influenced by many factors (eg.
culture, age, attitude to risk)
– guiding principle when setting objectives:
• understand your client’s needs so you provide investment
services they will value and appreciate
Investment strategy:
– is the means used to achieve the investment objectives:
• investor allocates funds between asset classes; or
• purchases products where this decision is made for them

, Examples of
RMIT Classification: Trusted BAFI 1014


Investment Objectives
 Access Income
 Capital Growth
 Combination of income and capital growth
 Speculative
 Tax Driven Investments
 Philosophical Investing eg/Ethical/Environmental
 Educational Reasons- Investment Clubs