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Financial Research Project

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Submitted By visionspac
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There are significant differences between investing and trading. Investment considers longer holding periods whereas trading focus on only short-term holdings (Chong, 2012). An investment in Nordstrom is an investment in growth fund versus a value fund. Growth funds tend to experience faster than average growth in regards to earnings, revenues, or cash flow. The expectation is that growth funds have the potential for higher returns however these funds may also represent greater risk in comparison to value funds; these funds generally perform better when stock prices are rising and underperforming the market as stock prices fall. Investing in Nordstrom could require a higher tolerance for risk and an investment on time (“Growth Investing” 2015).
For an investment in Nordstrom our investor falls into two profiles: growth profile and aggressive profile. The growth profile is fitting for an investor with patience seeking investments with an expectation that that investment will grow above the average rate in comparison to the industry or to the overall market. An emphasis is placed on equity investments primarily designed to attain growth over a long period of time. Less of an emphasis is placed on fixed income investments, cash and cash equivalents. These investors generally do not require cash from their own investment account but like their investment to grow faster in comparison to the inflation understanding that the investment value may vary occasionally and these investors are comfortable with that. “The target asset allocation for this profile is 80% Equity and 20% Fixed income. The Growth investor's risk tolerance is best described as medium to high and they are willing to accept up to 30% of their account in riskier assets.”
In addition to being a growth investor our investor is also aggressive. “The Aggressive investor is attempting to achieve maximum

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