In the month of September, 2005 an investment analyst had suggested to the investment committee of Optimal Funds (the Fund) to spend $10 million in La-Z-Boy, in adding up to the $20 million that the Fund had previously invested. The analyst thought Lazboy represented powerful worth yet, having only been on the job less than one year, he understood that he needed to provide sound judgment and evaluation to convince the investment committee and to preserve his authority.
Subsequent to determining the entry price for La-Z-Boy shares, the analyst was requested by the committee to supply several additional pieces of info including valuation and entry-cost determination; opinions on the higher beta and lower price-to-earnings ratio as compare to its commerce average; dangers and proper mitigation efforts of committing 12 per cent of the fund to an individual business (La-Z-Boy); diversification efforts of the fund; and opinions on the fund's overall investment strategy. The analyst understood several other analysts were providing their own investment recommendations to the investment committee and that he'd just two days to develop and strengthen his claim for investing in La-Z-Boy.
PUBLICATION DATE: December 23, 2008 PRODUCT #: 908N22-PDF-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
