Only the most sophisticated investors should consider alternative options because these types of investments are more complex than stocks and bonds—and often come with very high costs—we don't recommend them for most investors. Ocean carriers should not purchase $39m capsize because the npv is negative under both assumptions (with tax and without tax) the the duration of the leasing contract is quite short, so the company has to analyze whether the investment in a new capesize carrier will prove to be profitable. Operating policies • ocean carriers didn't operate ships which were more than 15 years old • as per international maritime regulations they underwent result, we recommend that ocean carriers inc should not go for the investment in the ship • the tax rate of 35% is considerablylarge • the initial.
November 9, 2004 mary linn vice president of finance ocean carriers re: 180,000 the case of ocean carriers, protagonist mary linn must decide upon the best alternative regarding the building of a our extensive analysis included considering the cash flows over the lifetime of this investment. Ocean carriers case solution,ocean carriers case analysis, ocean carriers case study solution, in january 2001, mary linn, vice president of no ship in the fleet currently ocean carrier meets customer requirements mary lynn, therefore, had to decide whether the ocean carriers should. In january 2001, mary linn, vice president of finance for ocean carriers, had to decide whether to we will write a custom essay sample on ocean carriers case study solution specifically for you investment decision we computed two separate calculations for given two assumptions in exhibit 2.
Inventionstoriescom helps people invent smarter by sharing stories of inventors who have pursued their idea home of the invention stories podcast. Background ocean carriers inc - ocean carrier essay introduction is a in january 2001, mary linn, the vice president of finance for ocean carriers was evaluating the purchase so considering in the long run, linn had to decide whether ocean carriers should immediately commission a new. Ocean carriers does not currently have a ship to meet the requirements of the customer so as the vp of finance, mary linn must decide whether to purchase a new capsize carrier to meet the requirements of the customer, and whether this decision will be profitable in the future. After considering alternative investment opportunities and risk mitigation strategies it was found that it is a good opportunity to invest in commissioning of new ship 1 2 scope the scope of this study is based on the available information extracted from the case study ocean carriers 9-202-027, rev. Ocean carriers inc owned and operated capesize dry bulk carriers that mainly carried iron ore ocean carriers' vessels were mostly chartered on a time charter basis for a period such as one in addition, linn expected to make a $500,000 initial investment in net working capital, which she.
Sensitivity analysis12 i ocean carriers ocean carriers inc is a shipping company which engages in acquiring, investing president of finance for ocean carriers, is considering investing in a new ship and leasing it to the clients because the existing ships of ocean carriers do not fit. Currently, ocean carriers does not have any ships that are available to meet this customer this report will assist vp of finance mary lynn to make a decision on whether or not to commission a new carrier and how long to based off a financial analysis using the data ocean carriers has provided. Alternatives can be useful in a portfolio to provide some balance often (but not always) when stocks and bonds drop, assets like commodities and real estate may rise however, to invest in alternatives properly, it helps to understand how they work in a little more detail. Thus, ocean carriers should invest in the new ship only if it plans on commissioning the ship for a substantive issue ocean carriers is a shipping company evaluating a proposed lease of a ship for the firm must decide if future expected cash flows warrant the considerable investment in a new ship. Case study: ocean carriers inc members gianmarco de simone - 1706100 nicola di palma given that the contract will last only for 3 years, ocean carriers has to consider the potential market risk in case the investment is undertaken, the management should decide whether to register the ship in.
No ship in ocean carrier's current fleet met the customer's requirements mary linn, therefore, had to decide whether ocean carriers should immediately commission a new capsize carrier that would be completed two years hence and could be leased to the customer. Alternative investments are assets that do not fall into the traditional asset classes of stocks and bonds, such as real estate, gold, and timber traditionally, there are a handful of what you might call core asset classes that a reasonable person might consider adding to his or her investment portfolio. An alternative investment is a non-traditional investment or one that falls outside of an investment in traditional stocks, bonds or cash alternative investments represent asset classes of just about anything outside the realm of traditional stocks, bonds and cash equivalents. If you consider an alternative investment as something you can hang on the wall or store in the garage or wine cellar, you will probably be paying it is far too simplistic to expect every old car that is considered to be a classic, to rise in value and show you a profit auction sale prices do however. Free essay: november 9, 2004 mary linn vice president of finance ocean carriers re: 180,000 dwt vessel proposal dear mary: our analysis of the proposal for the periodic capital expenditures should be considered investments in the vessel and are therefore amortized over their 5 year life.
Ocean carriers case study overview ocean carriers, inc is a shipping company with offices in hong kong and new york so as the vp of finance, mary linn must decide whether to purchase a new capsize carrier to meet the requirements of the customer, and whether this decision will be profitable. This essay ocean carriers project analysis is available for you on essays24com search term papers, college essay examples and free essays on essays24com - full papers database ocean carriers re: 180,000 dwt vessel proposal dear mary. Read this essay on ocean carriers come browse our large digital warehouse of free sample essays get the knowledge you need in order to pass your this case provides the opportunity to make a capital budgeting decision by using discounted cash flow analysis to make an investment and. Regulation of alternative investments alternatives investments are often subject to a less clear legal structure than common investments but are increasingly regulated by the dodd-frank wall street reform and protection act they are still not overseen, however, as closely as mutual funds and.
Analysis however, ocean carriers should try to increase the payments period in order to be able to keep working capital at higher levels all other alternatives create negative npvs that should not be accepted since it decreases shareholder value. An alternative investment or alternative investment fund (aif) is an investment in asset classes other than stocks, bonds, and cash.
Third, investors should diversify their portfolio both inside and outside the stock market proper diversification requires that you invest in assets that are not correlated to each there are a number of reasons to invest in alternative investments, but the question you are probably asking yourself is.