Investment policy statements guide investment decisions from "summary" of Institutional Investment Management by Frank J. Fabozzi
An investment policy statement (IPS) serves as a roadmap for institutional investors to navigate the complexities of the investment landscape. It outlines the objectives, constraints, and guidelines that will shape investment decisions over time. By clearly articulating the organization's goals and risk tolerance, the IPS provides a framework for evaluating potential investment opportunities. The IPS is not merely a static document; rather, it is a dynamic tool that evolves in response to changing market conditions and organizational priorities. As such, it serves as a reference point for decision-makers, helping them stay true to the organization's long-term investment strategy. By anchoring investment decisions in a well-defined policy framework, the IPS guards against impulsive actions dr...
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