This Case is about MARKETING
PUBLICATION DATE: October 27, 2009 PRODUCT #: 909N22-PDF-ENG
In the month of October 2008, the senior vice-president for merchandise and business development at IA Clarington (IAC), a life and health insurance firm, was arrange for a discussion with the president of IAC. The subject of discussion would be IAC’s Target Click Fund, a mutual fund with an options-based guarantee construction targeted towards investors who were looking for increase together with capital preservation.
The vice president was requested to deliver his view of whether he believed the fund’s scheduled rebalancing date should be hastened in order to benefit from a historical decline in international equity markets. The vice president had to consider several pieces of advice in making his recommendation, including that fact that his chief rivals would be quick to make the most of any misguided recommendation.
He wondered if the markets had really hit bottom, and how/if he could time the rebalancing to the lowest stage. Additionally, the investment philosophy behind IAC and click funds supported investors to stay invested during troubled times: what would altering the rebalancing date suggest to those investors?
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