Module 3 · Portfolio Management

Portfolio Management: An Overview

EN: Investment process, types of investors, and pooled vehicles.
VN: Quy trình đầu tư, các loại nhà đầu tư, vehicle gộp vốn.

1. Three-Step Portfolio Management Process Concept

1. Planning Understand client, write IPS.
2. Execution Asset allocation, security selection, trade.
3. Feedback Monitor, rebalance, performance review.

2. Types of Investors Concept

Individuals

Individual goals, taxes, life-stage allocation.

Institutions

Pension DB (asset-liability) vs DC (member-directed).
Endowment Long horizon, intergenerational equity.
Foundation Mission-driven, often distribution requirements.
Insurance Asset-liability matching, regulatory constraints.
Banks Liquidity priority, conservative.
SWF Sovereign wealth fund — long horizon, large.

3. Pooled Vehicles Concept

Mutual fund Open-end (NAV trading) vs closed-end (fixed shares, market price).
ETF Trades intraday on exchange; arbitrage keeps price near NAV.
SMA Separately managed account — direct ownership.
Hedge fund / PE / VC See Alts subject.

Practice problem Practice

Practice problem

A 65-year-old retiree needs steady income and capital preservation. Long-term horizon but uncomfortable with volatility. Suitable investor archetype?

Show solution

Income/conservative profile typical of retirees.

Lower equity %, higher fixed income/cash, ESG/wealth preservation focus.

Conservative individual investor with income objective