IF2210 Asset Management Notes, for CASS Business School students, contain an overview of every topic covered within the module.
Summarised into a 28-page single document, the notes were prepared using both lecture notes, in-class discussions and core textbook (ISBN: 3364)
Lecture 1: Introductio...
Lecture 1 – INTRODUCTION AND OVERVIEW OF THE FUND MANAGEMENT INDUSTRY
The 4 main ASSET CLASSES:
1) CASH – notes, coins, banks deposits, short-term government bonds under 1-year
because they are the most liquid)
Advantages: liquid, safe (less uncertainty)
Disadvantages: low return, may not be as safe as we think (because of the banking
crisis for e.g.)
2) EQUITY/SHARES can be classified into 3 types:
Domestic (UK) = underlying shares risk (uncertainty of return)
Developed nation (France, Germany) = underlying shares risk + exchange
rate risk
Emerging market (India, Ecuador) = underlying shares risk + exchange rate
risk + political risk
Advantages: offers higher return than bond and cash
Disadvantages: has greater risk than bond and cash
3) FIXED INCOME/BONDS/DEBT can be classified into 3 types:
Domestic (UK) = interest rate risk + credit risk + rating risk (depending
whether the bond will be hold till maturity or not)
Developed nation (France, Germany)
Emerging market (India, China)
Advantages: offers higher return than cash
Disadvantages: has greater risk than cash
4) ALTERNATIVES – derivatives, private equity, real-estate, commodities and art
Advantages: low correlation with other asset classes, well diversified,
reduced volatility of overall portfolio
Disadvantages: illiquidity (higher transaction/trading costs but with ETFs it is
less difficult to trade)
ASSET ALLOCATION – the choice of allocating money across different asset classes
SECURITY SELECTION – the choices within asset classes
SERVICES provided by INVESTMENT COMPANIES:
1. Record keeping of what is going on in terms of assets in their fund and
administration
2. Access to diversification and divisibility
3. Professional management (professional managers who know what to do with their
investors’ money)
1
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller nmn82. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $12.91. You're not tied to anything after your purchase.
