The company’s pension plan is managed by Castle Fund Managers, a leading provider of pension services. It is a defined contribution plan, where the employees’ contributions are matched by the employer. Each employee had to choose one of the following investment options for their individual plans: a. Preferred Accumulator (PA): Short-term focus b. Balanced Accumulator (BA): Medium-term focus c. Select Accumulator (SA): Long-term focus However, there has been some concern raised over how the pension fund is being managed. Some employees are upset that Castle Fund Managers uses a diversified asset allocation strategy for its investment. Required: Prepare a short report which explains: a. The importance of strategic asset allocation, b. Three (3) benefits of using this approach, c. Three (3) factors that could affect how assets are allocated.
The company’s pension plan is managed by Castle Fund Managers, a leading provider of
pension services. It is a defined contribution plan, where the employees’ contributions are
matched by the employer. Each employee had to choose one of the following investment
options for their individual plans:
a. Preferred Accumulator (PA): Short-term focus
b. Balanced Accumulator (BA): Medium-term focus
c. Select Accumulator (SA): Long-term focus
However, there has been some concern raised over how the pension fund is being
managed. Some employees are upset that Castle Fund Managers uses a diversified asset
allocation strategy for its investment.
Required: Prepare a short report which explains:
a. The importance of strategic asset allocation,
b. Three (3) benefits of using this approach,
c. Three (3) factors that could affect how assets are allocated.
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