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SOP Notes

Portfolio managers need to understand client objectives and constraints to construct appropriate asset allocations. They review risk tolerance, liquidity needs, time horizon, taxes, and circumstances. Analytics determine variance, beta, diversification, and allocation. Advanced analytics identify trends and winning stocks while avoiding losses within a time horizon.

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53 views1 page

SOP Notes

Portfolio managers need to understand client objectives and constraints to construct appropriate asset allocations. They review risk tolerance, liquidity needs, time horizon, taxes, and circumstances. Analytics determine variance, beta, diversification, and allocation. Advanced analytics identify trends and winning stocks while avoiding losses within a time horizon.

Uploaded by

HARIHARAN A
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Portfolio managers need to understand client objectives and constraints in order to construct

appropriate asset allocation. Reviewing a client’s objectives and constraints includes


understanding risk/return appetite, liquidity needs, investment time horizon, tax profile, unique
circumstances and any current legal issues. Data analysis of how categorical inputs like liquidity
needs (none, current, future, etc. ), time horizon (short- term, long- term) or taxes (pays taxes or
does not pay taxes) blend together in decision making process.

Portfolio analytics seeks to determine the variance of each security, overall beta of the portfolio,
the amount of diversification and the asset allocation within the portfolio. The analytics seek to
understand the risks associated with the current composition of the portfolio and identify ways to
mitigate the identified risks.

Advanced analytics to capture trends, identify stocks with a high probability to be winners, and
avoiding securities that may result in losses within a time horizon. It provides value for wealth
and asset managers’ thus increasing revenue, trade flow, client engagement, acquisition and
retention.

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