Since the AM forum is almost dead.
This question comes from a phone interview I had today: How would you answer this interview question: You just signed on a new client who recently sold his business and received $50MM after taxes. Go
Me: "In order to better understand the financial goals of the client it would require a very deep understanding of their current financial situation. I would need to assess their family situation, (kids, grand kids, etc..) risk tolerance, investment comfort level, needs, constraints, tax situation, etc… to gain a holistic perspective of their financial picture. With that being said, let’s suppose the client was willing to undertake a moderate amount of market risk and would not need much of the money to support his/her current lifestyle. Therefore I would suggest a portfolio allocation of roughly 45% equities, 30% fixed income, and 25% alternatives. Breaking that down into the sub-asset class level I would allocate the equity weightings towards domestic and international large and small capitalization securities. On the fixed income side I would look to invest the 30% weighting into high quality domestic and foreign short and intermediate duration corporates and municipals (local). As for the alternatives space I would like to include some hedge fund strategies, real estate, natural resources, and also some emerging market debt and equity exposure. I feel that this mix of asset classes would provide the client with a large amount of diversification amongst many non-correlating asset classes. This portfolio is designed with the primary objective of moderate capital appreciate and income as a secondary objective. Based on the investable net-worth of the client he/she may potentially wish to create a dynasty trust or some type of charitable endowment to instill a lasting impact on their future lineage and the surrounding community."
Is there anything else I could have added?
The interviewer asked me a few other fit related questions and ended the call with her saying "the hiring process is moving extremely quickly, you should expect a call from me or the hiring manager within in a week to arrange a final round on site interview". Sounds good right?
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