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Basic Question 2 of 3
Which of the following constraints would most likely appear in the unique needs and preferences section of a trust's investment policy statement? The portfolio is ______.
B. prohibited from investing in tobacco companies
C. prohibited from holding less than 5% in cash instruments
A. subject to the prudent-man standard
B. prohibited from investing in tobacco companies
C. prohibited from holding less than 5% in cash instruments
User Contributed Comments 3
| User | Comment |
|---|---|
| amityadav | Why not C? Though it will be upto the PM but cant it be inlcuded in IPS for such preference as mentioned in C. |
| Olesya_CFA | I thought so too but then this came to my mind: keeping more than 5% in cash could be a general requirement for many investment institutions. Nothing super unique about it. However tobacco is clearly something very specific for a certain type of investors. It's their personal preference. So the answer makes sense to me. |
| khalifa92 | "unique" |
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Learning Outcome Statements
describe the steps in the portfolio management process
CFA® 2025 Level I Curriculum, Volume 6, Module 3.