Assignment sells- This company works in long term

Assignment

BKI Investment Management Ltd.

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Name of the student

1/17/2018

 

 

 

 

 

Contents

Summary-………………………………………………………………………………………………………………………. 3

1.Introduction to ASX Listing Companies-………………………………………………………………………… 3

2. Production cost and scale-…………………………………………………………………………………………….. 4

3. Macro business environment-………………………………………………………………………………………… 6

4. Sustainability practice of the business-………………………………………………………………………….. 10

References-…………………………………………………………………………………………………………………… 12

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary

How it works

This study presents about one of the ASX Listing Companies named BKI Investment Management LTd. Shares of the company are  listed on stock exchange. Selecting the proper stock from the various options available is necessary. Thus, the proper study of business operations needs to be done where the return will be earned by the shareholders of the company. Because of the existence of complexities, the investment in the financial capital becomes complex nature (Elton, et al., 2004). Even the banks are playing an important role in selling these securities listed on stock exchange.There are lots of risks involved in this case. Where banks are playing an important role.

After earning money, proper decisions required to be made concerning the money earned. The acquisition needs to be good to not to have the disastrous impact. Thus, the size and scope of this case play an important role. It can monitor both the success and ability of the business. Thus, the success, in this case, becomes more critical. It also makes the entire work more critical (Edmans, 2011). Right investment helps in selecting the right company, and nature will unmatch the return.

Introduction to BKI Investment Management Company-

–          Name and location of the business, the type of business-

–          BKI was formed on the 17th October 2003 to take over and manage the investment portfolio of Brickworks Limited (BKW). BKW established the core portfolio during the 1980’s with the objective to generate an increasing income stream through long term investment in a portfolio of securities that would grow over time.

–          What is the business produces and sells-

This company works in long term investment portfolios and tries to generate maximum revenue. This company is investment in listed and securities.

–          Who are the main customers-

The customers are the people and shareholders dealing in listed and securities of the capital market.

 

AGK                  

AGL Energy Ltd

Utilities

2

AGO

Atlas Iron Ltd

Materials

3

AIO

Asciano Ltd

Industrials

4

ALL

Aristocrat Leisure Ltd

Consumer Discretionary

 

–          Where most of the customers are located-

The customers are located at diversified locations in Brisbane.

–          Who the main competitors-

The main competitors are the companies dealing with the similar business of investment in listed and securities.

–          Where the competitors are located-

The competitors are located in the different parts of Brisbane.

–          The market shares of key competitors-

The market shares of key competitors depend upon the investments made by the clients. It is normally high in case of ASX Listing Companies. BKI has to deal with the market expansion strategies.

2. Production cost and scale-

a. Fixed and hence unlikely to very much according to quantity of goods produced or sold, or

ASX 200 is the index in the capitalisation market weighted with the 200 companies listed on the Australian Stock Exchange. When compared with ASX 50, it is the broader index. It makes 85 percent market cap in the stock market of Australia.

Here, in this case, the market capitalisation will be weighted. There is no percentage of the index stock. Relative size is used to determine the weight of ASX index (Chavas & Falco, 2012). ASX 200 is the factor that is used to measure the performance of equity in the large cap. If the company is large, the weight will be high in the index.

BKI is investing for clients in listed and securities under the provision of Australian Securities and Investment Commission. The segment of the company includes management of funds, the software of investment as well as direct investment. The BKI Investment Management  Ltd. is based in New South Wales, Australia.

 

Percentage

Financial

7%

Materials

5%

Industrials

7%

Telecommuincation services

10%

 

 

b. Variable and hence likely to increase with increased production or sales-

SPI 200 futures-

It is the contract of futures where the trader is gaining exposure to a single transaction. Such contracts are traded for 24/7. It is normally available for six quarterly and to the nearest of two to the nation quarterly expiry months (Chavas & Falco, 2012). The most liquid contracts are the expiry months and front months.

Index exposure management on the micro level is possible with the help of ETF. The portfolio position can be managed with the help of index fund. It helps to gain exposure to the index.

ASX ETF 200-

The BKI uses the long-term massive index to measure its performance. There are various reasons for which the index is used-

–          The fund manager can beat the market very rarely. Diversified portfolios are given to the index manager. The portfolio return is the return of the market.

–          The advantage of cost- Fee of annual management of STW is 0.286%. If the cost of the index fund is low, it will add to the large portion of the overall portfolio.

The stock which has grown in earnings required to be found. Various studies are carried out the chart of the company, their various stock price, volume of trading and the statistical indicators (Brown, et al., 2012). This is called as the technical method of investment. It is one of the important methods as the investment is carried out based on the growth in the stock price in the market. Such investing values are the intrinsic values.

 

Percentage

FTSE 100

0

S & P 500

-20

ASX 200

-10

DAX Index

-5

 

 

 

3. Macro business environment-

a. The overall stability of the political system/ government of the country in which the business operates-

The stability of the government of the country include the following-

– The government of the country is such that they encourage the free investment policy within the country. It will help to improve the movement of the investment. Anybody can invest in both listed and securities.

– There are least regulations imposed by the government of such countries. It will help to enhance the overall performance and profitability of the company (Brown, et al., 2012). Less regulation encourages the free movement.

BKI is doing the proper estimations concerning the business. This estimation will help to enhance the future estimates of the company. It is one of the important factors showing that the company will spend more to improve the performance of it by providing suitable training to them (Braun & Clarke, 2013). At the same time, it is motivated to put their best efforts towards the development and growth of the company. The growth of the company depends upon the performance of it of the company.

The performance is evaluated based on the measurement of output. The performance evaluation will help to improve the output of the BKI Investment Management Ltd. Here, in this case, the output will be the productivity of it. If the productivity is improved, the company will be more profitable. SuItable measures are taken for the same.

There is a need for the measurement of the demand and a need to determine whether the nature of the customers’ demands is homogeneous or variable.  It is a manager to find out whether the economies of scale or the scope helps to reduce the cost of the production technologies. Regional tariff needs to be identified by the manager (BEKAERT & URIAS, 1996). The best location can be selected based on the tax and tariff information. The logistics should be at the aggregate level and need to be identified by the manager. There is a need to define the appropriate number of facilities in the region. Hence BKI is trying to get all the information.

Demand is forecasted based on the region as well as the country. Economies of the scale are required to be measured. Demand risk, political risk, exchange rate risk, tax incentives, and risk import restrictions can be configured with the regional facility. Identification of the competItors is made (Farmer, 2012). Demand varies with the region as well as with the country. It can be high or low. Economies of large scale need to be measured to find out the configuration with the regional facility. There are various risks involved that are discussed above (Arouri, et al., 2011). Demand risk is the rise and fall in demand for the rise and fall in supply.PolItical risk is associated with the matters relating to politics, changes in the currency.The exchange rate can be riskier, and various tax incentives can act as restrictions. Various risks and the changes in the demand hamper the growth of the business. The smooth functioning of the business is affected by the various restrictions imposed. It is necessary to identify who the competitors are in the market. It is essential to know who your competitors are in the market. It will help in dealing with them by building a suitable strategy (Levine & Zervos, 1996).

 

b. The general level of inflation, unemployment and average interest rate of the country in which the business located-

It has the direct impact on inflation, unemployment and average rate of interest of the country. Due to inflation, there will be the rise in prices of stock. It will amount to decrease in the level of investment by the company. Inflation will reduce the number of shareholders. Thus, it is necessary for the company to reduce inflation that will enhance the overall performance of the company thereby, affecting its profitability. Now BKI investment Maanagement Ltd is trying to reduce the costs involved to deal with the rising inflation.

Again, another important reason is unemployment. If there is increasing rate of unemployment, there will be the reduction in the number of shareholders investing. As the level of investment is reduced, the company may suffer as there is the direct impact on the profitability of the company.

Finally, the average interest rate affects the overall performance of the company. If the rate of interest is high, there will be the reduction in the investment. And if the rate of average interest is low, there will be more demand for investment in the stock options in the market. Thus, proper strategy is required to be made for the same.BKIis working to increase the employee retention and provide better employee satisfaction.

The difference can be made in the same by being entrepreneurs are full of passion to make the things possible. It’s not all about sitting around and talking; they are about to make everything happen. The optimism should be unjustifiable. Uncertainty should be tolerated. Other people need to be concerned genuinely. BKI Investment Management Ltd being the market leader is able to take high risk and genetrate greater returns.. The propensity is considered to be the interest of motivation. If the individuals have high achievements, there will be moderate propensIty concerning risk. Uncertainty is accepted by entrepreneurs concerning the security of career, relations with family and the psychic relating to well being.

Tenacity includes the failures sustained by the Entrepreneurs (North, 2006). Passion is most of the entrepreneurs are having the strong determination of changing the world. It helps them to get through a hard time. AmbiguIty tolerance will help in the management of fear. It includes bankruptcy and payroll missing, etc., Vision means entrepreneurs face the future by keeping in mind all the estimations concerning future. Self-belief includes the self-confidence. It includes taking up the risk and becoming conservative. BKIis very commited to its stakeholders for their overall profits.

The company is collecting various data and information. BKI Investment Management Ltd. Is gathering the data relating to the number of staff employed by the company, their salary, their timing, the timings of the flights, the expenditure that is incurred for the services rendered to the customers, etc. Such information is required to be collected to provide optimum services. Proper knowledge helps to keep the staff well trained and to render their duties efficiently. It is necessary to make use of modernising technology as It will help in dealing with the major issues. Use of digital technology improves the efficiency of the business and ensures the business to render prompt services. It consists of the flight going to other countries; It helps to spread Its business globally by providing optimum services. Maximum customer satisfaction is needed to be achieved to sustain in the business.

c. If your business exports its products to other countries, provide some information about the exchange rate

The exchange range for BKI will be $42. The reason being the business is carried out in the different parts of Australia. It will help to find out the exact position of the business.

Finding a product is the important point of risk. Customers buy the products only when they find It. One of the common risks is to earn foreign exchange. Risking products to other country helps to earn the foreign currency. If this page is well designed, It helps to convert the visitors into buyers. Being the Consultant Country, ABC & Country shall make the following recommendations and suggestions that may help in developing a risk strategy that will allow providing a full range of risk service.

4. Sustainability practice of the business-

a. Does the production process of the business generate any positive or negative externalities?

There has been the increase in the pressure of the business day by day for BKI Investment Management Ltd.. To meet the increasing pressure, It is necessary to upgrade the technology (O’Sullivan & Sheffrin, 2007). There are various competitors available in the market. To sustain the competition and to stay in the market, It is necessary to upgrade the technology. Technological upgrade helps to provide timely and prompt services.

b. Does the consumption of goods produce by the business generate any positive or negative externalities? If negative, has the government put in place any measures to mitigate. What is done to mitigate the business? What is done to take advantage?

Yes, the consumption of goods produced by the BKI generates negative externalities. The measures put in by the government is to invest in goods only after reading all the required details. Everything should be disclosed to the customers based on which they can make the choices and BKI is following the same. All the required information concerning the volume, the price should be disclosed to the general public based on which the general public makes the final investment in the capital market.

Targeting customers is quite appealing to reach the large number of customers. Special offers help to attract a large number of customers. Personalization requires some experience to attract the customers’ interests. Proper creation of content to grab more customers, a winning risk helps to attract and stick to a large number of customers for a long time. Foreign currency is under the control of the UN and FDI, who look after their management. Integration of channel says the multichannel helps the customers to experience the product as well. Risking promotion affects the business as It brings more revenue to an economy and thus helps the economy to grow (Omisore, et al., 2012).
BKI Investment Management Ltd. is offering excellent dividend and growth offers to its customers for highest customer delight.

Some of the good design tips are the Proper catalogue of brand identity that the success of the market depends upon Its brand. Proper brand awareness should be created with the help of effective brand naming, etc. Design catalogue cover creates the first impression of the catalogue. Thus, the cover must be appealing and should convey the content of the risking products. Copy of the catalogue must be easy to read and understand. In photography of the catalogue, the good catalogue should be visual without much effort. Now BKI is using all these tools to achieve high business results.

 

References

Arouri, M. E. H., Jouini, J. & Nguyen, D. K., 2011. Volatility spillovers between oil prices and stock sector returns: Implications for portfolio management. Journal of International Money and Finance, 30(7), pp. 1387-1405.

BEKAERT, G. & URIAS, M. S., 1996. Diversification, Integration and Emerging Market Closed-End Funds. The Journal of Finance, 51(3), p. 835–869.

Braun, V. & Clarke, V., 2013. Successful Qualitative Research: A Practical Guide for Beginners. California: SAGE.

Brown, S. J., Gregoriou, G. N. & Pascalau, R., 2012. Diversification in Funds of Hedge Funds: Is It Possible to Overdiversify?. The Review of Asset Pricing Studies, 2(1), p. 89–110.

Chavas, J.-P. & Falco, S. D., 2012. On the Role of Risk Versus Economies of Scope in Farm Diversification With an Application to Ethiopian Farms. Journal of Agricultural Economics, 63(1), pp. 25-55.

Edmans, A., 2011. Does the stock market fully value intangibles? Employee satisfaction and equity prices. Journal of Financial Economics, 101(3), pp. 621-640.

Elton, E. J., Gruber, M. J. & Busse, J. A., 2004. Are Investors Rational? Choices among Index Funds. The Journal of Finance, 59(1), p. 261–288.

Farmer, R. E., 2012. The stock market crash of 2008 caused the Great Recession: Theory and evidence. Journal of Economic Dynamics and Control, 36(5), pp. 693-707.

Levine, R. & Zervos, S., 1996. Stock Market Development and Long-Run Growth. The World Bank Economic Review, 10(2), p. 323–339.

North, A. J., 2006. Seeing is believing? A beginners’ guide to practical pitfalls in image acquisition. Journal of Cell Biology, 172(1), pp. 120-130.

Omisore, I., Yusuf, M. & Christopher, N., 2012. The modern portfolio theory as an investment decision tool. Journal of accounting and taxation, 4(2), pp. 19-28.

O’Sullivan, A. & Sheffrin, S. M., 2007. Economics: Principles in Action. New Jersey: Pearson/Prentice Hall.

 

 

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