Assessing the future

 

You are working at Goldman Sachs as a new international equity analyst. As your first task you have been assigned to provide a brief report and presentation to the chairman about the market that you have been assigned.

 

Here are factors to consider:

 

1. Is the current exchange rate under or over-valued? What is your short-term projection for the exchange rate? Long-term?
   
   
2. What is the overall economic growth forecast in the country?
   
1. Is this consistent with current share price levels?
2. What is your best estimate for market-wide share prices over the next year? Five years?
3. Is there any political risk in the country? How or does this change your assessment?
4. How does your view for the forecasted exchange rate influence your assessment for the stock market?

 

3. Other things to consider
1. Are there certain sectors within the country that may be underpriced? What do you like about these sectors?
2. How would you advise someone to go about investing in this market.
3. If you were a U.S. company considering direct foreign investment, what would your biggest concerns be?
   
   

Provide at least one article that provides some good information on your country.

Provide a three page double spaced write-up in outline format that gives a brief assessment of these issues. Also be prepared to give a brief no more than five-minute talk to the class about the interesting aspects of what you have found. Remember, you job is not to provide a write-up of what the facts are but rather to tell in a logical framework how you plan to use the facts about this country to form a currency and investment assessment.