Chapter 22, Problem 5CP

Summary Introduction

To Discuss:

The correct answer from the given options which states that the investment policy statement of an institution must be concerned with all of the following except:

1. Its legal obligations to the client
2. The level of the market
3. Legal regulations
4. Taxation

Introduction:

An investment policy statement is a document prepared by the portfolio manager along with the client after careful analysis of the client's objectives and constraints. Thus the statement contains the specific objectives and the constraints of the client and the strategies the manager must adopt to meet these requirements.