Chapter 33: Investments

Question 1

What are the principles of investment?

Answer 1

1. To minimise risk, a company should select investments that match nature, currency, term (DMT)
2. Need to selects assets to maximise return
3. Maximise return within the companies risk appetite

Question 2

What are the 4 types of liability outgo?

Answer 2

1. Guaranteed in money terms
2. Guaranteed in terms of some non-investment index
3. Discretionary liability
4. Investment-linked liability