Sch book 3 LOS23r, pg 149
All,
Can anyone please confirm if Core include Passive and semi active investments (irrespective of the outcome of semiactive strategy)?
Thank you
Indexing and emhanced indexing.
Correct- the core portion of a Core/ Satellite approach consists of the passive strategies and enhanced index strategies. I feel the term semi-active is not as appropriate as enhanced index. I know they are implying the same thing; however, I would be more inclined to use the term enhanced index on the exam (as opposed to semi-active).
Swaption11 and cross-ied,
both thank you
I have not realised the terminology i was using was wrong.
Do you know if any specific places where these terms have to be particularly used?
Thank you
I wouldn’t use the term “wrong,” I would use more appropriate. Once you get to sample questions/ mocks (if not there now), you will see questions tend to reference them as enhanced index strategies as opposed to semi-active. I have seen roughly 3-5 questions where the matrix is provided and all have been referencing enhanced index. Most likely, you will be asked to calculate the percentage of the core portion of the core/ satellite strategy. It will most likely reference a passive manager, a few active style strategies, and “hide” an enhanced index strategy somewhere in the middle. Was attempting to help train your process to recoginize enhanced index, and avoid looking for the word active. Now that I say this, the exam will almost certainly reference semi-active 