Chapter 5 Pmt

Front 1

What is the primary objective of portfolio management?

Back 1

To earn a competitive rate of return on an investor's asset

5 .4

Front 2

The blank space, has overall responsibility for an institutional investment management firm's portfolio management activities

Back 2

Chief Investment Officer

Front 3

What is the primary purpose of the asset mix committee?

Back 3

Is to establish the target asset mix

Front 4

Over a one year period, the weighting of the target asset mix does not normally change more than what percentage?

Back 4

5%

5.5

Front 5

All portfolio managers in a particular asset class report to?

Back 5

Head of asset class

Front 6

Who has dotted line reporting relationship to portfolio managers ?

Back 6

Trading staff have dotted line reporting relationship with portfolio managers

5.8

Front 7

What is the primary challenge for security trading?

Back 7

Is to buy or sell the requisite amount of securities at a price that is close to the bid or offer

Requisite : necessary

5.8

Front 8

Who understands market depth better than a portfolio manager?

Back 8

Experienced trader

5.8

Front 9

A number of institutional investment management firms offer some of their investment mandates to individual investors. Under regulatory requirements, these individuals must qualify as blank space?

Back 9

Exempt investors

5.18

Front 10

The length of time it takes for an institutional investment management firm to be awarded its 1st mandate from an institutional investor depends on 3 factors. What are they?

Back 10

The length of time the firm has been in the business,

The consistency and competitiveness of the firm's portfolio performance,

The firm's sales and marketing capabilities

18

Front 11

What are the 2 primary duties of chief investment officer?

Back 11

1.General management of the firm's investment management function and supervision of their direct reports

2. Acting as the chairman person of the firm's asset mix committee

5.4

Front 12

Theere are two basic sales and marketing approaches for institutional investors. What are they ?

Back 12

Direct contact,

The use of Pension Consultants

Front 13

To which department of institutional investment do the potential investment management firm make a presentation to make them hire and appoint a business ?

Back 13

Investment committee,

17

Front 14

After investment committee completes the due diligence and interview process with the potential investment management firm to award new business, which department does the final approval?

Back 14

Board of trustees,

17

Front 15

What is the strategy those investments management ,who believes individual investors can be a more stable book of business over time than institutional investors, use?

Back 15

They have a deliberate development strategy to grow their individual investor business

18

Front 16

Sales and marketing materials introduce the firm to potential new investors and tend to focus on four main topics.

What are they?

Back 16

1. The owner or portfolio manager,

2. Investment mandates,

3. Investment strategy and investment decision making process,

4. Performance track record

Front 17

What is the primary objective of security trade execution?

Back 17

Best execution,

Meaning the best price at which the securities are bought or sold

Front 18

What is the primary responsibility of trader?

Back 18

Execute the firm's security trading activities in an effective and efficient manner

Front 19

What is the primary challenge for security trading?

Back 19

Is to buy or sell the requisite amount of securities at a price that is as close as possible to the currently qouted bid or offer prices

Front 20

In Termination process of institutional investment firm, how long does the management firm have at minimum amd maximum to improves its results?

Back 20

Minimum 2 quarters

Maximum of one year,

to improve its results

20

Front 21

What is the primary objective of client service at institutional investment firm ?

Back 21

To provide current investors with the appropriate amount of verbal and written communication regarding the management of their asset

Front 22

What is the hallmark of a smoothly functioning portfolio management team ?

Back 22

Pooling of investment ideas,

And,

market intelligence