Citi Virtual Internship Task 1 PDF

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VIrtual intership notes...

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Citi Virtual Internship Task 1 1. a. b. c. d. e. f. g. h. i. j.

Financials – overweight Materials – underweight Healthcare – neutral Real estate – neutral Consumer discretionary – neutral Energy – underweight Consumer staples – neutral Information technology – underweight Telecommunication Services – neutral Utilities – neutral

2. a. Macroeconomic factors that are relevant include: COVID-19 had a huge impact economy-wide, negatively affecting most sectors. Huge government stimulus packages will have major effects on future tax rates and household income. GDP and economic growth will slow drastically as global markets recover. Unemployment rate is at an all time high. Interest rates will be lowered to encourage expenditure, negatively affecting financial sector. The technological advancement of the world is leading the charge, meaning IT will grow tremendously as a sector. Furthermore, as world economy recovers, demand for materials will be increased as countries try and decrease unemployment rate. Mounting pressure on government to implement clean solutions to energy. b. Microeconomic factors that are relevant include: sentiment is moving away from the big 4 banks, ‘decentralised’ currencies like cryptocurrencies. People are moving to independent and smaller banks as awareness of malpractice in bigger banks increases. As the world economy restabilises after COVID-19, there will be a push for development to help create jobs and decrease employment rate. Therefore, demand for materials will increase, potentially causing another minerals and energy boom – hence the rebalance from financials to materials. In terms of future sectors, I think energy is under-represented as there is growing pressure for governments and households to be making the transition to renewable energy (or clean alternatives). Including the emergence of EV’s.

3. I would invest some in bonds as they aren’t affected so heavily by the rest of the world economy. More of a safer investment with less returns, which is appropriate for a 75-year-old, as a lost retirement fund can’t be earned back. I would not invest in currencies as I believe the effects of COVID-19 will have many dragging indicators. In addition, there is currently political unrest between the US and China, with too many factors affecting the exchange rate negatively....