Data and solutions
Part 1
I chose to invest my money in GIC’s. the reason why is because GIC’s are guaranteed and I cannot lose my capital. I originally thought doing stocks would be better. For stocks I used 7.48% rate for the first two years and for the third year I used (-18.60%) because that is how much S&P index is down this year. that amounted to only $102,112.75.
Part 2 (Calculations and Graph)
Stock return average over 5 years 7.49%
————————————–
S&P return for 2022 -18.60%
————————————–
GIC example $80K in 3yr GIC plus $10K
| Year | Start Value | Growth | Percentage | Additional Savings | Total at Year End |
| 1 | 80000 | 3,360.00 | 4.20% | 83,360.00 | |
| 2 | 83360 | 3501.12 | 4.20% | 86,861.00 | |
| 3 | 86861 | 3648.18 | 4.20% | 90,509.18 |
$10K placed in 1 year GIC
| 1 | 10000 | 350 | 3.50% | 10,350.00 | |
| 2 | 10350 | 362.25 | 3.50% | 10000 | 20712.25 |
| 3 | 20712.25 | 725.1 | 3.50% | 10000 | 31,437.35 |
Total Savings at Year 3 ~ $121,946.53
(Excel)
Part 3
when I first started I thought stocks would be better, but if I have one bad year I might lose a lot of money. That is why for the down payment I will have a better chance with a guaranteed investment with a GIC.
Core competency reflection
- I found working with my group went pretty good for most of it. Some parts we did get stuck on but I think we were able to persevere through it.
- I Tried my best to get a full understanding of what we were doing and talk to my group. My peers helped me on parts where I got stuck like calculating a GIC and all that stuff
- I started by using the graph created with my group. However, I realized that stock rate of return was not exactly correct so I had to recalculate everything over.
- my skill to work with other is probably around a 3.5/4 , as I’m very comfortable talking with everyone and I try my best to input.