WEALTH MANAGEMENT - S6 (2nd Dec 2023) [Autosaved].pptx

WEALTH MANAGEMENT Sheikh Zayed Islamic Center 02nd Dec 2023 Syed Muhammad Yaseen Ali Trainer Profile   Experience:  Bank Alfalah Islamic – Product Development  Soneri Bank Mustaqeem  Mashreq Bank UAE  Sheikh Zayed Islamic Centre / NIBAF / IBA  Faysal Bank Barkat  Meezan Bank...

WEALTH MANAGEMENT Sheikh Zayed Islamic Center 02nd Dec 2023 Syed Muhammad Yaseen Ali Trainer Profile   Experience:  Bank Alfalah Islamic – Product Development  Soneri Bank Mustaqeem  Mashreq Bank UAE  Sheikh Zayed Islamic Centre / NIBAF / IBA  Faysal Bank Barkat  Meezan Bank Education: ACCA, CSAA, PGD (IBF-CIE), CIFE-UAE) Outline  Returns Return  Return can come in two forms:  Income (interest/profit/rental payments or dividends)  Capital Gains Return Measures  Holding Period Return (return for holding an investment from one period to the other)  For example:  You invest in share valuing PKR 50 and it increases to PKR 60. (60/50) - 1 = 1.2 - 1 i.e. 20%  Arithmetic or Mean Return (sum of the returns of investments divided by the number of investments)  For example:  You invest in 3 shares. Share A gave 10% return, Share B gave 20% return and Share C gave 30%.  So, (10% + 20% + 30%) / 3 = 20% Return Measures  Geometric Mean Return (Good for Time Series Data)  For Example:  You invest in Share A, and the annualized return over the last three years was 10%, 20% and 30%.  So, (1.1 x 1.2 x 1.3)  Portfolio  1/3 -1 = 1.1972 – 1 = 19.7% Return: You invest in three different share. Investment Weightag Returns s es Portfolio Share A 50% 20% 10% Share B 25% 10% 2.5% Share C 25% 40% 10% 22.5 % Return Measures  Annualized Return  For Example:  You invest in Share A which gives you 2% return in 20 days.  So, (1.02) ^ (365/20) – 1 = 1.4353 – 1 = 43.53% Other Return Measure  Gross Return: It is the return earned by an asset manager prior to deducting management fees and taxes; measures investment skills.  Net Return: It accounts for all managerial and administrative expenses; this is what the investor is concerned with  Pre-tax nominal return: It is the return before accounting for inflation and taxes; this is the default, unless otherwise stated.  After-tax nominal return: It is return after accounting for taxes.  Real Return: It is the return after accounting for taxes and inflation.  Leveraged Return: