1. Executive summary and portfolio recommendation overview: Overall summary of the investment thesis and portfolio recommendation. (1 page)
2.Overview of the portfolio’s investment goal: Presentation of the investor’s goal and risk profile that is guiding the construction of the recommended portfolio.(1 page)
3.Tactical asset allocation (TAA): Choice and justification of asset classes included in the TAA (long-term). Allocation must be aligned with the macroeconomic analysis, CMAs (although CMAs are long-term oriented), and investor’s goal/risk tolerance. (2 pages)
Asset Allocation in short term:
Macro analysis & CMA(Part 5 & 6) + Risk Profile：Summarize macroeconomic analysis and predictions for the future (short term). Economic expectations, impact on major asset classes
Update – News/ events (Short-term)
Overweight allocation/tendency of major categories of assets and sub-categories:
Adjustment of major categories of assets based on SAA (can be displayed graphically)
Selection of subcategories: Sector/Industry; Factors; Strategy
Combined with the previous parts of Macroeconomic analysis and Capital Markets Assumptions, summarize the key support points (chart + text)
Short-term trend/projection (chart + text)
Demonstrate TAA composition and reasons for selection (e.g., Pie, Table)
TAA that has to be analysis:
First Trust S-Network Future Vehicles & Tech ETF
SPDR S&P Metals & Mining ETF
Tips:
The Return cannot be negative number， because what we analysis is satellite part in core-satellite portfolio.
Text descriptions need to be accompanied by diagrams
4. ETF selection: Presentation of the ETFs that will be representing the asset classes included in the core and satellite parts of the portfolio. There can be more than one ETF per asset class. There needs to be an explanation of the management approach (passive or active)
of each ETF considering whether they belong to the core or satellite. In addition, there needs to be an explanation of the methodology used to select the ETFs (including
management fees and performance metrics). (2 pages)
Specific ETF product summary (e.g., Pie + Table)
Considerations/logical reasons for screening
Methodology Summary & explanation/justification:
Specific Sector/industry
Value or Growth Oriented (style)
Market cap (size)
• Strategy
Risk (e.g. volatility)
ESG consideration
Some other considerations: Management fee ; Management company/firm ; Return/Risk
Whether consistent with investor’s goal & risk profile?
ü How relative to objective?
Tips:
Text descriptions need to be accompanied by diagrams
Keep the sources and charts used in the process for appendix
