Essay on finance case vanguard international growth

Issues 1. Explain why an individual investor might want to invest in an international growth fund? 2. Describe the risk associated with making an investment in an international growth fund. Identify the risks that would be common to domestic an international funds, and those risk that would be unique to an international fund. 3. Discuss how the fact that foreign companies are not subject to the same accounting, auditing, and financial reporting standards and practices as U.S. companies poses a risk not typically encountered when investigating in the stock of U.S. companies. 4. Consider the allocation of funds assets by region. Speculate as to why the portions of fund assets are distributed in this manner. 5. Consider the country†¦show more content†¦The International Growth Fund annual report that ended in August 31, 2009 showed that 94% of the Funds portfolio was invested in 177 non U.S. stocks and 6% was in temporary cash investments. All values are presented in the tables. Analysis 1. An individual investor may want to invest in an international growth fund because of trying to expand or growth in the foreign market. Another reason would be to diversify and acquire more knowledge about the foreign economy. 2. Some risks that are common between domestic and international funds are: losing money and management risk. Any investment has some type of risk. Losing money is the first risk that every investment has whether it is domestic or international. Management risk is the bad management decisions that a company makes. Some unique risks that only international funding has are: economic risk, country/regional risk, and currency risk. Currency risk is the chance that the value of a foreign investment, measured in U.S. dollars, will decrease because of unfavorable changes in the currency exchange rates. Economic risk is the stability of a country’s economic. Country/regional risk is political, financial troubles, and natural disasters that will affect the value of securities issued by companies in foreign countries or regions. 3. Foreign companies are not subject to the same U.S. Accounting Practices the foreign stock and bond markets operate differently from theShow MoreRelatedClosing Case 13953 Words   |  4 PagesClosing Case: Chapter 13 Bonnie Jordan Managerial Finance Instructor: Kristi Rayford March 11, 2013 The Closing Case in Chapter 13 focuses on options for a 401K for an employee of the East Coast Yacht Company. Several decisions must be made regarding investments, which will be highlighted in this discussion. Equity investments can go into the S amp; P 500 or an index related option. The former has lower fees, and the latter higher ones. Other elements to be discussed include theRead More123456787123 Words   |  29 PagesGoldman Sachs while Toronto Domino Bank shows the least economic mass. 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