Learning Module 4 of Portfolio Management 8–12% of the exam
Basics of Portfolio Planning and Construction
8 lessons. About 0 minutes in cram mode, 0 minutes in full.
Lessons for this module are being written. The outcomes and lesson plan below are final.
Lessons
- 1 The Investment Policy Statement
Coming soon
- 2 IPS Risk and Return Objectives
Coming soon
- 3 IPS Constraints
Coming soon
- 4 Gathering Client Information
Coming soon
- 5 Portfolio Construction and Capital Market Expectations
Coming soon
- 6 Strategic Asset Allocation
Coming soon
- 7 Portfolio Construction Principles
Coming soon
- 8 ESG Considerations in Portfolio Planning and Construction
Coming soon
What the exam expects you to do
- Describe the reasons for a written investment policy statement (IPS).
- Describe the major components of an IPS.
- Describe risk and return objectives and how they may be developed for a client.
- Explain the difference between the willingness and the ability (capacity) to take risk in analyzing an investor’s financial risk tolerance.
- Describe the investment constraints of liquidity, time horizon, tax concerns, legal and regulatory factors, and unique circumstances and their implications for the choice of portfolio assets.
- Explain the specification of asset classes in relation to asset allocation.
- Describe the principles of portfolio construction and the role of asset allocation in relation to the IPS.
- Describe how environmental, social, and governance (ESG) considerations may be integrated into portfolio planning and construction.