CFA level 3 - Private & Institutional Wealth Management
<Ethics>
특정 섹터에 대한 투자를 외부에 outsoucing하는 경우 - 해당 기관이 expertise되어 있는지 점검, 시행하지 않을 시 고객에 대한 loyalty(3(A) 위반
Supervisor로써의 의무 - enforce investment policy(오답 : investment와 non-investment를 모두 강화해야함...)
Regular account info - Quarterly 제공되어야 함.
Compliance officer 역할 - Manual을 읽게만 시켜서는 안 되고, Test와 verify까지 시행.
Violation 적발 시 supervisor - chain of command 보고로는 충분하지 못함. place limit on the employee's activity까지 시행해주는 게 좋다.
<PWM>
*Concentrated position을 해결하는 세 가지 method?
Monetization, hedging, outright sale. outright sale, owner can sell the position, but result significant tax liability. monetization strategy provide the owners with funds to spend or reinvest without triggering a taxable event. long put(protective put) isexample of hedge
Human life value method 이용시 Begin payment 세팅 까먹지 말기
없으면 안들어오는 돈 (세후 기준)- 얘 없으면 안쓸 돈 = PMT
PV / (1- 보험료 세율) = Total coverage required.
만약 이미 존재하는 보장 있으면 해당 액수 deduct해주기.
Tax drag분모 = gain from non-tax (1빼주기!!)
Tax loss harvesting과 그 advantage
Definition - pushing a portion of tax liability into subsquent years. it make net-of-tax money available for investment. if investor can reinvest amount incurred from tax saving, it could increase total accumulation wealth.
Benefit of trust
Transfer of asset to his wife and children without the potential publicity associated with probate.
avoid disputes within the family
responsible stewardship of assets while his children are minors, and afterwards if they are unable to manage the assets themselves
Tax are paid donor's estate, size of taxable estate is reduced.
이자율이 낮은 환경에서 연금 구매가 적절하지 않은 이유 : Purchase of a large fixed annuity when interest rates are low will lock in relatively low payment
The real value of payments from a fixed annuity declines over time due to inflation(인플레가 높은 상황)
Equity-like wage와 insurance need;
A has a higher correlation between wage growth and risky-asset returns because part of her income is based on equity returns. her wage growth correlation implies lower HC as her wages are riskier and thus should be subject to a higher discount rate. therefore, higher wage growth corrlelation is a factor that recuces life insurance need
<IWM>
Endowment의 return objective
> Maintain purchasing power of the PF asset in perpetuity (똑같이 쓰면 된다)
기대인플레이션과 Endowment&Foundation의 Risk tolerance
>> 기대인플레 상승 시 Take more risk to make nominal spend constant >> Tolerance가 증가. but try to hold more liquid asset make lower risk tolerance
Endowment valuation의 두 가지 smoothing rule
Geometric decline rule의 경우 최근 value에 더 많은 weight를 주는 반면, three-year rolling rule의 경우 동일한 weight를 주기에 후자의 risk가 더 크다.
Endowment에서 Cash reserve의 역할
>> set as percent of the annual grant making budget, this amount will be kept in cash until the year is mostly over and the average asset value known. it can cause a year-end rush of grants during an up year, prevent overspending during down year
* DB vs DC feature별 비교
Benefit payment - vesting schedule is the same in both plan, although contributions in the DC plan are vested immediately. DB plan provides a defined payment linked to final salary and years of service, whereas DC provides an uncertain benefit based on A's contributions as well as the investment performance of the plan assets
Contribution - A's Contribution rate to the DB plan is not known, but the plan is fully funded. however, there is no guarantee that it will remain fully funded or that A is committed to maintaining the DB plan's fully funded status.
Shortfall risk - DC plan, shortfall risk falls to her and depends on the x% contribution rate from the company.
Mortality/Longevity risk - DB pools mortality risk. in DC plan, insuree bears the risk of outliving her savings.