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Portfolio Investment Decisions
Portfolio Investment Decisions
Name
Institution
Portfolio Investment Decisions
Introduction
Investing in a group of investment requires allocation of income in specific rations to ensure maximum revenue generation. The distribution of income and resources is determined by the financial information of the investments, including prices, cost of financing and constant rent expected from the venture. Research on properties in various areas and analysis of their efficiency is required to attain maximum reward on the investment made. It functions to evaluate the client’s portfolio, calculate revenues expected from investing in the four chosen suburbs, including Kingsbury, Preston, Bandoura and West Heidelberg. Also, the compounded returns are used to to identify the most appropriate actions to take in investment. The decisions may include either using agencies to manage properties or individual management. A recommendation will be made on the necessary arrangements that the client should take regarding the portfolio investment.
Market research and efficiency figure
Managerial functions can be provided by other companies such as Airbnb and Real estate. The agencies manage, performs repairs, and rents the properties on behalf of the owners. Airbnb led properties to charge its tenants weekly in that every tenant who rents one of the properties under the management of Airbnb pays their rent every week. The median house prices for the properties in Kingsbury, Preston, Bundoora, and west Heidelberg vary due to the changes in the environment and conditions of the house. Preston rents at $ 600, Kingsbury at $ 580, Bundoora at $610 and Heidelberg at $550. From the revenue received from renting, Airbnb deducts a percentage to cater for the services they provide in the properties. Therefore the owners of property returns after deduction of the fee for the services offered when managing the properties.
In the real estate, Kingsbury median rental rate is $385 weekly, earning a yield of 3% per annum. Property in Preston charges $550, with a 3.9% yield yearly. Bundoora, property charges $420 with a 2.9% yield, while Heidelberg charges a rent of $360 per week, having a yield of 2.9%.
Therefore, higher income may be earned by investing in properties in Preston and Kingsburg since they have a higher percentage of yield compared to the properties in Heidelberg and Bundoora.
From the prices of property for both agencies, the rent is more elevated when investing through Airbnb than through real estate. Therefore, the cost of management will also be higher for the agency compared to real estate, which will be lower.
If the clients Airbnb properties are occupied four days a week, the efficiency figure will be:
[ (5/7) X 100] = 57.14%
The period at which the property is occupied is dependent on the prices of the properties. Airbnb has high prices that may not be affordable for everyone hence reducing the occupancy within a week. This is the reason why its efficiency figure is low at 57.14%, compared to the real estate, which has an efficiency figure of 90%.
The portfolio of the client
The client wishes to invest in 30 properties located in Bundoora, Heidelberg, Preston, and Kingsburg. The allocation of several houses considered the rent income received from each of the suburbs. Preston has the highest rent figure, depicting higher returns when the investment is made on them, compared to the houses in the two other regions. Also, the yield per annum is more elevated for homes in Preston and Kingsburg; therefore, more houses were from the. The client’s portfolio will include.
From the pie chart, Preston has ten houses, Kingsburg has eight houses, while both Bundoora and Heilberg has six houses. The percentages are calculated as:
Preston- 10/30 x 100= 33.33%
Kingsburg- 10/30 x 100= 33.33%
Bundoora- 5/30 x 100= 16.67%
Heidelberg- 5/30 x 100= 16.67%
Also, the houses are split between the Airbnb management and the real estate agency. The split is in the ration 1:1, to maximize the returns, having different managerial rules. The split is shown below:
The rental payment period for all the apartments will be one week. Therefore, the tenants who get into the apartment will be paying weekly charges, for the period they will be staying in the property.
Demonstration of Revenues
Because the agencies will manage 50% each of the client’s portfolio, each will have 15 houses in the various suburbs chosen. The revenues are as shown below:
15 properties of Real Estate Agency Median weekly rent for a single property Weekly median rent for all the properties Monthly Rent {Median weekly rent X 4 (for all properties)} Yearly Rent {Median monthly rent X 12} Efficiency % {Median Yearly rent X 90% Efficiency}
Preston $550 $2,750 (5 houses) $11,000 $132,000 $118,800
Kingsburg $385 $1,925 (5 houses) $7,700 $92,400 $83,160
Bundoora $420 $1,260 (3 houses) $5,040 $60,480 $54,432
Heldelberg$360 $720 (2 houses) $2,880 $34,560 $31,104
Total $1,715 $6,655 $26,620 $319,440 $287,496
12 properties of Airbnb Median weekly rent for a single property Weekly median rent for all the properties Monthly Rent {Median weekly rent X 4 (for all properties)} Yearly Rent {Median monthly rent X 12} Efficiency % {Median rent per year with 57.14% Efficiency}
Preston $600 $3,000 (5 houses) $12,000 $144,000 $82,282
Kingsburg $580 $2,900 (5 houses) $11,600 $139,200 $79,539
Bundoora $610 $1,830 (3 houses) $7,320 $87,840 $50,192
Heldelberg$550 $1,100 (2 houses) $4,400 $52,800 $30,170
Total $2,340 $8,830 $35,320 $423,840 $242,182
The real estate agency has an efficiency of 90% hence the revenue is likely to be higher compared to Airbnb with 57.14%. However, the charges for Airbnb is higher than that of the real estate; hence revenues are expected to be higher for the same number of houses. Because of the advantages of each, investing in 15 apartments for both agencies may create a good portfolio for maximum profitability.
Demonstrations of Cost
Property agencies incur costs in managing the properties to ensure the maintenance and proper state. Therefore, a specific percentage of the revenues is paid to the agency to enhance its operations. Real estate agents charge a rate of 8% to 12% of the monthly income received from various Suburbs.
The price covers costs for maintenance of the houses, labour for cleaning and repairing, and also vacancy where the properties are not rented out. Using a rate of 10% monthly, the real estate costs would be:
Real estate Monthly Income for each Property Monthly income from the properties x 10% Monthly maintenance cost Total maintenance cost per year
(Monthly maintenance cost X12)
Preston $ 11000 10/100 X 11000
$1100 $13200
Kingsburg $ 7700 10/100 X 7700 $770 $9240
Bundoora $ 5040 10/100 x 5040 $504 $6048
Heidelberg $ 2880 10/100 x 2880 $288 $3456
Total $3142 $31944
The total managerial cost for real estate agency is $ 31944
Airbnb charges 15% for every nightly rate for the maintenance of the property. Therefore, the cost for a month will be:
Airbnb Median night rent for a single property Median rent for all properties Management cost (15% X night rate) Charges per month (Management cost per night X 30) Maintenance cost per Year (Monthly charge x 12)
Preston $85.71 $428.57 $64.29 $1,928.57 $23,142.86
Kingsburg $82.86 $414.29 $62.14 $1,864.29 $22,371.43
Bundoora $87.14 $435.71 $65.36 $1,960.71 $23,528.57
Heidelberg $78.57 $392.86 $58.93 $1,767.86 $21,214.29
Total $334 $1671.43 $250.71 $7,521.43 $90,257.14
The charges per year for the Airbnb is $ 90,257.14
Overall net Position
With the revenues and cost calculated, the net Position of the client will be revenue less the management cost. The net Position is as shown below:
For the real estate portfolio:
Median Monthly Income Monthly managing cost Total revenue/ Month Total Revenue Per Year Total maintenance cost per year Total revenue 90% Efficiency
Preston $ 11000 $1100 $ 9900 $118,800 $13200 $106,920
Kingsburg $7700 $770 $6930 $83160 $9240 $74,844
Bundoora $5040 $504 $7560 $90720 $6048 $84,672
Heidelberg $ 2880 $288 $3888 $46656 $3456 $43,200
Total $31420 $3142 $ 28,278 $339,336 $31,944 $309,636
For the Airbnb:
Median Monthly Rent Total Management Cost Per Month Total revenue/ Month
Total Revenue per Year Total Managing cost per year Total Revenue 57.14%
Preston $12,000 $1,928.57 $10,071.43 $82,282 $23,142.86 $59,139.14
Kingsburg $11,600 $1,864.29 $9,735.71 $79,539 $22,371.43 $57,167.57
Bundoora $7,320 $1,960.71 $5,359.29 $50,192 $23,528.57 $26,663.43
Heidelberg $4,400 $1,767.86 $2,632.14 $30,170 $21,214.29 $8,955.71
Total $35,320 $7,521.43 $27,798.57 $242,182 $90,257.14 $151,924.86
The investor will receive $309,636 per year for the investment in real estate and $151,924.86 for the investment in Airbnb.
Conclusion and Recommendation
Investment in the suburbs having fifteen properties managed by each of the agencies gives a wide range of returns results. However, the analysis shows that investing in real estate is much more profitable due to the high-efficiency rate of 90%. Airbnb has a lower efficiency rate of 57.14% and also the management rate is higher at 15%. The clients should choose to invest more in the real estates in a ratio of 1:2 or 70% to 30%., the higher being the real estate. This decision will maximize the profits as it would lead to more returns from real estate.
The development of children brain, language and social learning
Experiment: The development of children’s brain, language and social learning.
Introduction
This experiment was designed to show how music helps in the development of children’s brain, language and social learning. The hypothesis was chosen to demonstrate the positive influence of music in early childhood. The study evaluated the performance of 100 pre-school children as they sing and learn through songs and how it impacts on their learning outcomes. The participants were monitored for 2-hour periods twice a week in a pre-school environment and compared to another group of children that stayed at home and watched television most of the time. Learning outcomes for the two groups of children were tested and the results were consistent with the original hypothesis. The study showed that children exposed to music through their life are more successful in school and life than those that watch television and play video games during normal hours. The developmental implications are long lasting and will affect their leadership abilities in future.
Analysis of presentation
The study was conducted on 100 children (40 boys, 60 girls) aged between 3 to 5 years in a day-care facility in Naples, Florida. 80% of participants were white, 12% Hispanic, 6% Black, and 2% Asian all with a mean age of 4.4 years. The experiment compared the learning outcomes for children who attend pre-school and those that stay at home during this period. The outcome was that children learn better through music than through conventional means. Furthermore, they develop useful skills that will make them better leaders as compared to the other group not exposed to music. The information from this experiment is useful in many ways. It helps in the formulation of effective teaching curricula for maximum benefit to both children and teachers. It also underscores the importance of pre-school learning in contributing to giving children a firm foundation that will serve them for the rest of their lives.
The results of this study were consistent with findings from similar studies. According to Trainor and Fujioka (2006), young children exposed to music show different brain development and improved memory compared to children not exposed to music. The musically-trained children in the experiment performed better in a memory test correlated with general intelligence skills. Skills tested include verbal memory, literacy, mathematics, vision-spatial processing and IQ. Development changes were seen to occur within relatively short periods, as early as four months. As they participate in music activities, children also improve their physical, socio-emotional, cognitive and language development (Tainor & Fujioka, 2006). Even without the intervention of adults, children naturally learn from music through instinct. However, when they are exposed to music through singing and playing instruments, they become better at it and develop other useful skills as well.
In another study, Gooding (2011) found that children exposed to a systematic and integrated music program scored highly in motor, language, cognitive and social-emotional measurements as assessed by the Preschool Evaluation Scale. Singing appropriate songs helps children learn math, science and language concepts. Music also helps with memory – when items are memorized in a musical way, children are able to remember them more easily. When children read music or hear and move to a beat, they develop one-to-one correspondence skills. Recalling a series of sounds or actions helps them to gain serialization skills (Gooding, 2011).
Groves (2006) showed that there is strong correlation between music and the development of spatial-temporal intelligence. The relationship is even stronger in cases where children learned music notation. The researchers assigned preschool children to music lesions, computer lessons and no lessons. Those children that took music lessons showed a significant increase in spatial-temporal intelligence while there was no change in the children in the other groups.
Leadership dimensions
The role of music in children’s development has long-lasting effects that persist until adulthood. Modern leadership requires a certain set of skills and abilities that help one relate effectively with others (Groves, 2006). A good leader should be able to establish and maintain social networks, deal with subordinates, and empathize with other leaders. For this reason, one must have strong interpersonal skills and high emotional intelligence. Emotional intelligence refers to the ability to indentify, understand and manage emotions in a way that facilitates useful thinking. Social intelligence is based on ability to communicate and interact with others effectively. (Albrecht, 2006) found that emotional expressiveness is considered a good leadership quality. Music plays a huge role in the development of emotional expressiveness from an early age.
An important part of leadership has to do with motivation, for oneself and others. A good leader motivates his/her subjects through a shared vision and purpose-driven goals. One important requirement for motivation is good communication. It is a means of providing information as well as making others feel recognized and important. Communication should be done in a clear and transparent manner and should target all relevant players. The leader should be a source of motivation to his/her subjects. This requires one to lead by example, to show commitment to the course and provide encouragement during tough times. A good leader will seek to build useful relationships with his subjects, and this requires taking time to know and understand them.
Empowerment is important if a leader wants to get the best out of his subjects. When subjects are empowered, they feel motivated to take initiative and get creative. This promotes innovation in an organization and employees feel valued. Empowerment involves various aspects like giving employees a certain level of powers, including them in decision-making, and providing the necessary tools and environment to enable them work effectively. The ability to empower people stems from a high level of emotional intelligence, which will enable the leader to effectively understand the needs of his subjects and respond to them appropriately (Albrecht, 2006). This emotional intelligence is enhanced if one is exposed to music from an early age.
Finally, self-esteem is very important, not just in leadership but life in general. Self-esteem has to be built into the individual right from an early age. Childhood is a very sensitive period and it is during this time that self-esteem is built or broken. Teaching children early enough on being confident and believing in themselves in crucial. Music has been shown to contribute effectively to the development of self-esteem in children. The children are able to gain confidence, learn faster and believe in their abilities to tackle various challenges. This self-esteem carries through to adulthood and will impact on their leadership abilities. To be a good leader, one needs high self-esteem so that they develop that self-belief before they can inspire others to believe in them (Albrecht, 2006). Music from an early age is an effective tool for developing self-esteem.
References
Albrecht, K. (2006), Social Intelligence: The New Science of Success, Jossey-Bass, San Francisco, CA.
Gooding, L. (2011). The effect of a music therapy social skills training program on improving social competence in children and adolescents with social skills deficits. Journal of Music Therapy, 48(4), 440-62.
Groves, K.S. (2006), “Leader emotional expressivity, visionary leadership, and organizational change”, Leadership & Organization Development Journal, Vol. 27, pp. 566-83.
Tainor, L. & Fujioka, T. (2006). First Evidence That Musical Training Affects Brain Development In Young Children.” ScienceDaily. ScienceDaily, 20 September 2006. <www.sciencedaily.com/releases/2006/09/060920093024.htm>.
The development of art and craft
ART AND CRAFT
Name
Date
Art and Craft
The development of art and craft has taken a very long time. One of the major milestones was experienced in the 18th century during industrial revolution. The rapid shift from human craftsmanship to mechanization really transformed art. Many changes were experienced in the existing architectural designs as a result of the invention of more advanced tools. Hence, there were the emergence of the Art and Craft and Arts Nouveau movements. The Art and Crafts movement advocated for traditional craftsmanship characterized by the use of simple designs with less visible decorations.
These were mainly the traditional medieval Romantic styles which were influenced by the British flora and fauna. They used fewer decorations. On the other hand, the Nouveau movement promoted the introduction of new architectural designs using modern machines and materials like iron and glasses. These were used to generate distinct whole designs of materials including furniture (Louis, K., 2001).
Each of these movements greatly revolutionized art and craft in many ways. Their contributions in this field are still being felt in the contemporary society. The Art and Crafts movement influenced reputable artists such as William Morris; Braillie Scott and John Graham who made a lot of designs. This movement influenced the designing of the Red House; Blackwell; Oregon Public Library; Shaw’s Corner and Asilomar Conference Grounds. These are aesthetic structures with simple and less superfluous decorations which emphasize on the nature and quality of the materials used. This has become a common feature in many buildings today.
Likewise, Nouveau movement influenced many artists including Émile André; Ernesto Basile; Max Fabiani and Alphonse Mucha. This led to the designing of Kirche am Steinhof; Rado House – 5; Hotel Manduševac and the Peacock Room. These were very great works which have influenced the modern art up to the present times. They were more refined designs which involved the use of modern tools to create objects which would appeal to the people socio-economic a political situation (Nicola, G.B., 2006).
References
Louis, K. (2001) the Viking Book of Aphorisms. New York: Viking Press.
Nicola, G.B. (2006) the Irish Arts and Crafts Movement (1886-1925), Irish Arts Review
Yearbook, 1990-91), pp. 172-185.