Friday, August 23, 2013

Suitability from a Retiree Perspective

The suitability of an investment for someone in their thirties is unlikely to be the same as a person that is retired.Retirees have different objectives , reduced loss capacity and are subject to several constraints. Advisers, compliance officers and complaint investigators do not seem to account for the unique characteristics of retirees in assessing suitablity . Read the full article    

Saturday, August 3, 2013

Sample Investment Policy Statement (IPS)

An Investment Policy Statement ("IPS") is a document, generally between an investor and his/her advisor , recording the agreements the two parties come to with regards to issues relating to how the investor's money is to be managed.The presence of an IPS helps to clearly communicate to all relevant parties the procedures,investment philosophy , guidelines and constraints to be adhered to by the parties. It can be seen as a directive from the client to the advisor  about how the money is to be managed, but at the same time the IPS should provide the guidelines for all investment decisions and responsibilities of each party. As a policy document rather than an implementation directive, the IPS should provide guidance for how investment decisions will be made; it should not be a list of the specific securities to be used; sometimes it includes prohibited securities though. A good sample IPS provided by Weighhouse can be found here  

Thursday, August 1, 2013

White Paper : A Case for Index Fund Portfolios

White Paper : A Case for Index Fund Portfolios . This paper makes a poweful case for using index funds. It contains some other surprising results, none of which are good news for actively-managed funds. Read the full Research paper