CFA Institute
Task 3 of 5

Sub-Portfolio A

Non-discretionary

Essential commitment regardless of market conditions.

5.2% P.A.Expected Return
7.4% P.A.Volatility
>95%Min Success Probability
10%50%40%

Asset Allocation

  • Cash10%
  • Investment-grade bonds50%
  • Large-Cap Stocks40%
  • Small-Cap Stocks0%
  • Alternative Investments0%
  • Total100%

Sub-Portfolio B

Discretionary

Important objectives the client intends to achieve but could scale back if circumstances require.

6.0% P.A.Expected Return
10.5% P.A.Volatility
>80%Min Success Probability
10%30%20%35%5%

Asset Allocation

  • Cash10%
  • Investment-grade bonds30%
  • Large-Cap Stocks20%
  • Small-Cap Stocks35%
  • Alternative Investments5%
  • Total100%

Sub-Portfolio C

Aspirational

Ambitious, long-horizon goals contingent on portfolio performance. Not essential to client's core financial security.

6.0% P.A.Expected Return
13.1% P.A.Volatility
Up to 70%Min Success Probability
5%10%30%40%15%

Asset Allocation

  • Cash5%
  • Investment-grade bonds10%
  • Large-Cap Stocks30%
  • Small-Cap Stocks40%
  • Alternative Investments15%
  • Total100%
Back