Hi guys! What has been your experience so far with questions on IPS? The scenarios appear endless and that makes it challenging to comprehend…
I reckon it will be practice practice practice. I had a look at the question on last years paper on IPS. It looked ok…
RR/TTLLU Have those carved into your mind. Address each them one-by-one on the exam.
ws Wrote: ------------------------------------------------------- > RR/TTLLU > > Have those carved into your mind. Address each > them one-by-one on the exam. +1
while we are on the subject: what size of a portfolio is considered large? 500k +? what kind of return objective relative to the portfolio size is considered large? 10% +? 5% +? and what’s the risk tolerance if an investor has large portion in small cap and emerging market stock, but he says he’s avg risk averse? I was under the impression to take the lesser of the 2, practice problems seems to suggest otherwise.
In the scope of creating IPS. I don’t know how to answer what is a large portofilo…I guess it is relative. A $10K portfolio is large to a homeless person. Return objective need to be reasonable and achieveable, otherwise, education is needed for the investor to set correct expecation. Always watch investor’s action instead of what they say. Take your example, the person has large % in small cap, and he states he is average risk. Point out the conflict on the IPS, “write, more education will be needed to fine point client’s risk objective.” If willingness is less than ability, honor willingness. If ability is less than williningness, honor abiiliy. ====>honor the lesser one.
So 45% returns for a guy with child support and divorce payments to make isn’t reasonable? Well sh!t.
^Yes, I guess Tiger Wood’s advsiors are sh!t out of luck.
say, this guys says he’s average risk averse, but his portfolio is full of emerging market stock and small caps, his portfolio is 2 mil. above average ability I think (maybe below average ability compared with paris hilton), what about willingness?