Investment advice process Flashcards
1
Q
What three dimensions cover a client’s risk level?
A
Attitude to risk
Tolerance of risk
Capacity for loss
2
Q
What might a typical investor have as their investment objectives?
A
Capital preservation
Capital appreciation
Current income
Total return
3
Q
What investment constraints might an adviser come across?
A
Time horizon Liquidity Tax Legal factors Unique needs i.e. ESG requirements
4
Q
What is the difference between positive and negative screening of investments?
A
Positive actively looks for good companies, negative actively looks for bad companies to avoid
