the economic environment, characteristics and impact of economic and business cycles, including: interest rates exchange rates inflation government monetary and fiscal policies the operation of financial markets and the roles played by intermediaries and issuers structure and inter-relationships within financial markets and inter-relationships between industry sectors financial products, including: the concept of a financial product general definition specific inclusions and exclusions types of financial investment products types of financial risk products taxation issues in relation to Margin Lending, financial products and markets in which they operate deductibility of costs associated with margin lending, e.g. interest payments liability for capital gains tax advisory functions including: the role of the representative or adviser participants in the advisory services market range of services provided profile and financial information of the client appropriateness of a risk assessment relevant industry codes of practice and conduct complaints resolution procedures (internal and external) regulator guidelines including the requirements of ASIC characteristics of Margin Lending products how the various types of margin lending facility products operate providers' and clients' rights and responsibilities effect of provider taking security over clients' assets effect of provider receiving a transfer of the clients' assets calculating loan-to-value ratios of both individual products and the overallportfolio consequences of issuers altering the loan-to-value ratio of individual products margin calls: ways of making a margin call consequences of margin calls, and how they may beresolved strategies bywhich the borrower may avoid margin calls approved product list: consequences of removing a product from the approved products list operation of Margin Lending markets including: the role of gearing suitability and responsible lending provisions loan to value ratios margin calls types of products: standard and non-standard Margin Lending facilities associated risks alternative products (e.g. derivatives where relevant) theories of investment, portfolio management and management of investment and risk: investment concepts investment strategies identification of types of risk client risk profile investment options using a margin lending facility identification of types of risk, including an awareness of the sensitivity of margin lending strategies to changes in interest rates and investment returns client risk profile, including an awareness of the source and stability of clients' income source, the source of funding for the investment risk profiles unsuited to margin lending facility products stress testing of proposed client portfolio understanding of risks associated with gearing: the relationship between levels of gearing and risks risks associated with double gearing the legal environment and disclosure and compliance: the role of the provider relevant legal principles (e.g. Corporations Act, Financial Services Reform Act (FSRA), Trade Practices Act) specific regulatory requirements (e.g.responsible lending conduct, notification of margin calls) the relationship between ethics and regulatory requirements (e.g. good faith, utmost good faith) full disclosure of remuneration and fees and any other conflicts of interest which may influence the adviser's recommendation |