Guidelines and Procedures Manual

Question 1

PPM is about ….

Answer 1

the long-term stewardship of client wealth

Question 2

PPM is a …

Answer 2

Personalised advice discretionary investment management service designed to meet stated client investment objectives.

Question 3

PPM intends to be cost effective …

Answer 3

so that a client more than recovers costs through satisfactory LT performance

Question 4

Under PPM advisers take on the responsibility of managing investment portfolios under

Answer 4

An investment Authroity
within the limitations of an asset allocation
with approved securities and
other compliance procedures

Question 5

The PPM management style can be described as …

Answer 5

Long term management of and preservation of Client wealth. The focus of which is the minimization of risk through prudent and careful management.

Question 6

One important characteristic of the PPM service is ….

Answer 6

Personalised interaction with and attention to the needs of the individual /client

Question 7

PPM advisers make decisions based on …

Answer 7

A client’s circumstances and investment risk profile
established and regularly review investment objectives
guidelines and procedures specific to PPM

Question 8

PPM advisers in addition to their responsible under the investment authority need to be :

Answer 8

-Properly aware of the clients changing needs and expectations
-The degree to which individual clients can tolerate potential consequences of portfolio risk
-Implement a consistent and rational strategy upon which transaction are based

Question 9

Maintaining an appropriate asset allocation is a fundamental portfolio management discipline that precedes

Answer 9

individual security selection

Question 10

Client Specified must not arise from …

Answer 10

An adviser’s advice or endorsement of an alternate asset allocation

Question 11

From the 1st September 2017 - client may only specify that adviser invest in ….

Answer 11

One particular asset class.
in addition to this single asset class the portfolio may also hold cash to a max of 10% of total market value.

Question 12

Advisers may not promote non approved securities to clients …

Answer 12

then request the client sign an authority to hold those securities

Question 13

The level of risk tolerance for each client is determined in one of ….

Answer 13

four categories when the account is opened ( as evaluated in the CP)

Question 14

As a rule of thumb, best practice is to weight the security/ sector up to ….

Answer 14

half the upper limit

Question 15

The purchase of a non-approve security is an ….

Answer 15

immediate breach of the investment authority

Question 16

The transfer of a non-approved security into a portfolio will become a breach …

Answer 16

3 months from the date of transfer.
The non-approved security must be sold or transferred out by the actionable date.

Question 17

The record of PPM transaction decisions provides ….

Answer 17

a permanent record and is a valuable practice in confirming the suitability of each transaction in reference to sound portfolio management principles and the investment objectives of the client.

Question 18

What is the minimum number of advisers (advisers who are jointly coded to manage PPM accounts) required for an LIC?

Answer 18

Four

Question 19

What are the minimum requirements for an LIC ?

Answer 19

Meeting fortnightly (24 a year)
Completion of the meeting template app and peer review template
Ensuring that the meeting notes and peer reviews are reviewed as part of the agenda of the subsequent LIC meeting.

Question 20

How many peer reviews is an adviser required to complete per year?

Answer 20

12

Question 21

What is best practice with respect to new account documentation?

Answer 21

Work through all pre-account documentation in person with the client. As this allows for explanation, clarifications and is consistent with the personal service standards for PPM clients

Question 22

What are the recommended service standards for PPM accounts?

Answer 22

visit new clients to personally review first and perhaps second reports
personalise quarterly reports
See clients at least annually, for review
Initiate 6 monthly phone calls

Question 23

Asset allocation is intended to …

Answer 23

manage the underlying market and sector risk prior to the security selection process

Question 24

Reference strategy names