AF I’m with you that the question said would not hinder their ability, i think it was in the beginning of a large paragraph, and that is why i chose 2. but young_prof said that the question stated that the accounts had restricitons that would have been non-discretionary so I think 2 is incorrect
Guys, This question very clearly stated something like “this strategy couldn’t be implemented otherwise…” These assets are absolutely non discretionary. I feel that a SRI composite would contain discretionary SRI assets so the logical choice seems to be non-discretionary composite. Also, even though you don’t include non discretionary accounts in other reported composites you still include them in total assets under mgmt.
nikhilmarathe Wrote: ------------------------------------------------------- > Guys, > > This question very clearly stated something like > “this strategy couldn’t be implemented > otherwise…” > > These assets are absolutely non discretionary. I > feel that a SRI composite would contain > discretionary SRI assets so the logical choice > seems to be non-discretionary composite. Also, > even though you don’t include non discretionary > accounts in other reported composites you still > include them in total assets under mgmt. What do you mean by your quote? “this strategy couldn’t be implemented otherwise…” I remember them saying that the SRI would not affect their investment making abilities, so it is then, still a discretionary account and so can remain within the current composite. all this according to AFJ
difinetly put in SRI composite, as a simple SRI guidelines don’t inhibit the managers ability.
I took the test in asia. It clearly said “the restrictions WOULD affect the managers.” It was non-discretionary assets. so i picked non-discretionary composite
I would say it’s still discretionary. The screening critera are just like unique circumstance in IPS. Even if it is non-discretionary, it is not allowed to form a non-discretionary compsite. GIPS prohibit non-discretionary portfolio to be included in a composite.
but did it explicitly say Non Discretionary COMPOSITE??
You guys are hilarious. Let’s just wait for results day, shall we?
yep…ok
Refer CFA Vol.6, page 262 (last para) and 263. Might make this more clear.
tom18606 Wrote: ------------------------------------------------------- > Refer CFA Vol.6, page 262 (last para) and 263. > Might make this more clear. And what’s the summary?
“In some cases, the client’s investment constraints may significantly impinge on the portfolio manager’s flexibility…none of these constraints automatically renders a portfolio non discretionary…it may be appropritae to classify a portfolio as discretionary despite the presence of restrictions and to include it in a composite with other similar constarined portfolios” Source: CFA Books Vol.6, pages 262 and 263.
Thanks.