Programs & Courses

Portfolio Risk Management in Retirement

Investment & Retirement

By: Robert Ironside- Updated: Mark Taucar

Portfolio Risk Management in Retirement

PROGRAM: Investment and Retirement Planning Services Specialist

Largely due to advances in preventing heart disease and more aware, and healthy, lifestyles, Canadians who reach age 65 are more likely than ever to live into their 90's.  This takes retirement income planning into a much longer period in which a focus on continued accumulation and investing is as important as tax-efficient withdrawal of funds.  Capital must be preserved at the same time.  This course reviews the measurement and calculation of risk and return from this perspective.

WHAT'S NEW:

An advisor will be exposed to software and online tools that will aid in the application of the concepts discussed throughout the course.  Discussions and examples of how to employ these tools will be featured throughout the course graphically and in case settings.

Of great value to advisors will be the orientation of portfolio creation in the context of the current market environment – Chapter 10: Portfolio Management in the Context of the Current Market.  We will explore the changing environment for risk and return, and how it weighs on an aging demographic.  In addition, we will decompose the current interest rate environment and how it manifests into increasingly complex solutions and how we can focus on strategies for risk mitigation for pre-retirees and retirees alike.

CONTENT DESCRIPTION AND KEY CONCEPTS:

Imagine the power of capturing the underlying algebraic equations in the evaluation and management of risk and return in a pre-and post-retirement portfolio in a visual format so that clients and advisors can set short and long term goals, making better decisions about investing in this critical time when human capital is retired and financial capital must take over in providing income.  The result would be a greater peace of mind and the opportunity to transfer an increasing family net worth to the next generation.  In this course you will learn to:

  • Revisit financial literacy relating to investment activities to measure risk and return.
  • Explain and integrate Modern Portfolio Theory within decision-making with clients, relating it to a post-financial crisis environment that still bears a number of short and long term risk factors.
  • Use financial literacy to guard against complaints around inappropriate risk tolerance or investments.
  • Evaluate a variety of risks within asset classes using a multi-dimensional approach.
  • How to use the combination of both risk and return to make more informed recommendations.
  • How these processes can help you simplify and make more money in your practice.

Most importantly the advisor will learn how to build and evaluate his/her own efficient portfolio designs using common industry wide software.

CERTIFIED SKILLSETS:

Using the power of simulations and modelling, as well as a defined process for goal setting and financial assessments, students will learn to explain the most powerful financial concepts to predict and evaluate risk and return in the retirement period, use current data to make investment decisions and then monitor changes in personal net worth as a result of sound decision-making:

  • How to measure different types of returns.
  • How to measure, interpret and communicate standard deviation.
  • How the principles of correlation and beta can be used to reduce risk.
  • How the power of Modern Portfolio Theory and the Capital Asset Pricing Model assist in key asset allocation decisions.
  • How the Capital Market Line can be used to enhance the risk / return relationship.
  • How to use different software tools to apply this knowledge in your practice each day.

Summary of Key Concepts
Practice Management Thesis (Review before the exam)
Final Exam

MARKS ALLOCATION:

Quizzes 25%
Case Studies 50%
Final Exam 25%
Passing Grade 60%
Honours Achievement 90%

 


CE Credits

CE Credits
Knowledge Bureau 30 CPE credits
AIC 12837 - LC - 15 hours
IPBC 30 CE credits
ICM 12504 - LC/AS - 30 hours
PBA 30 CPE credits

Table of Contents

Introduction:
Chapter 1:
Measuring and Calculating Returns
Chapter 2:
Standard Deviation
Chapter 3:
Correlation & Beta
Chapter 4:
Calculating Portfolio Risk
Chapter 5:
The Efficient Frontier
Chapter 6:
The Capital Asset Pricing Model
Chapter 7:
Generating Risk Adjusted Returns
Chapter 8:
Indexing and the ETF Evolution
Chapter 9:
Software Tools for Portfolio Analysis
Chapter 10:
Portfolio Management in the Context of the Current Market

What Graduates Say

I love how this course brought a richer understanding of market terms and theory. Then topping it off with the tools we need to continue what we have learned to enrich our profession and benefit our clients. A much-needed course for all financial advisors in today's market. Barry A., NB