Equity: Study Session 10
Study Session Materials
Complete List of CFA Program Readings
Topic Overview
Equity Portfolio Management
Because equity securities represent a significant portion of many investment portfolios, equity management is often a critical component of overall investment success. The role of equities in an investment portfolio, the three major approaches used to manage equity portfolios, and the evaluation of equity managers constitute the major focus of "Equity Portfolio Management." Management techniques such as benchmark selection and style analysis are presented as tools for effectively measuring and controlling equity portfolio attributes in an international environment in "International Equity Benchmarks." "Corporate Governance" addresses the alignment of interests between a corporation’s managers and its equity shareholders. Although other investor classes are also concerned with corporate governance, the issue is particularly relevant for equity portfolio managers. Agency problems and conflicts of interest reduce a company’s appeal to investors and therefore directly affect its valuation. The reading concludes with an examination of the relationship between a corporation and its stakeholders and the arguments for and against a stakeholder-based governance structure.
View learning outcome statements (LOS) for reading objectives.
Complete List of CFA Program Readings
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“Equity Portfolio Management” Ch. 7, Managing Investment Portfolios: A Dynamic Process, 3rd edition, Gary Gastineau, Andrew R. Olma, and Robert G. Zielinski (Wiley, 2007) |
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“International Equity
Benchmarks” Ch. 10, Benchmarks and Investment Management, Laurence B. Siegel (The Research Foundation of AIMR, 2003) Free download (PDF) |
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“Corporate Governance” Ch. 1, pp. 15-56, The Theory of Corporate Finance, Jean Tirole (Princeton University Press, 2006) |
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