Chapter 22, Problem 10CP

Summary Introduction

(a)

To determine:

To formulate appropriate investment policy statement for the endowment fund.

Introduction:

An investment policy statement (IPS) is a document drafted for a portfolio manager by his client that outlines general rules for investment for the manager. This statement gives the broad investment objectives and constraints of a customer and illustrates the strategies to be formulated by the manager for meeting these objectives.

Summary Introduction

(b)

To determine:

To identify and briefly explain three major ways in which your firm's initial asset allocation decisions for the endowment fund will be affected by the circumstances of the account.

Introduction:

An investment policy statement (IPS) is a document drafted for a portfolio manager by his client that outlines general rules for investment for the manager. This statement gives the broad investment objectives and constraints of a customer and illustrates the strategies to be formulated by the manager for meeting these objectives.