Schroder Family (B): Setting an Investment Strategy

Schroder Family (B): Setting an Investment Strategy

By
George Parker, Alan Rappaport, Jaclyn Foroughi
2013|Case No.F306B| Length 13 pgs.

Having identified his “needs and dreams,” Paul Schroder had to figure out what to do next.
Putting emotions aside, he needed to identify the best options to come up with the required amounts of liquidity at the right times.

As Schroder thought through the issues, he viewed his company, Travel Imagination, as the key to his goals. He could continue to manage and own the business, but he was concerned about this asset’s concentration and unpredictability in his portfolio. While he was confident that the direct mail company could successfully face the Internet challenge, he was concerned that he might be wrong, and that he would expose his family to too much risk. He knew that he had too much wealth concentrated in this one company, and bad things can happen to good companies. His future support for his daughter Emily depended on it.

This case describes a hypothetical investor faced with the challenges of asset allocation, diversification, family businesses, risk, and leverage.

Learning Objective

Provide students with an opportunity to analyze wealth management and private investing issues raised in the case in order to develop a comprehensive wealth management strategy.

This material is available for download by current Stanford GSB students, faculty, and staff, as well as Stanford GSB alumni. For inquiries, contact the Case Writing Office.