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Level_III_R12_Essay_Quiz.pdf - Level III R12 Essay Quiz (4...

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Level III R12 Essay Quiz (4 questions, 20 minutes)Copyright © IFT. All rights reservedPage 1MIKE MARTIN CASE SCENARIOQUESTION HAS FOUR PARTS (A, B, C, D) FOR A TOTAL OF 20 MINUTES.Mike Martin is an investment manager at Magenta Asset Management. He is working closely with anewinstitutional client, “MapleLife Insurance (MLI)” toreview the investment strategy and assetallocation policy. Martin explains the three broad asset allocation approaches to MLIasset-only,liability-relative, and goals-based. He then suggests the most appropriate approach for developingthe investment portfolio. With MLI’s help, Martin develops the following investment objective: “Tofund liabilities by constructing a liability- hedging portfolio and investing excess assets in a return-seeking portfolio.”George Fletcher is the chief financial officer of Landmark Sports (Landmark), which is a leadingproducer of winter and water sports gear. Fletcher meets with Martin to discuss the pension planinvestments.Landmark is a small company, and its revenues come from the United States. Productdemand has been strong in the past few years, albeit highly cyclical. The company has a strong (low

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Term
Fall
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Mike Martin, investments Landmark

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