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Elements and Performance Criteria
Performance Evidence
Knowledge Evidence
To complete the unit requirements safely and effectively, the individual must satisfy generic and specialist knowledge requirements relevant to the products and activities in which advice is given.
Generic knowledge analyse and provide an overview of the economic environment including:characteristics and impact of economic and business cyclesinterest rates and exchange ratesinflationgovernment monetary and fiscal policyanalyse and provide a detailed explanation of the operation of financial markets including:roles played by intermediaries and issuersstructure and interrelationships within the financial marketsinterrelationship between industry sectors outline financial products including:concept of a financial product: general definition, and specific inclusions and exclusionstypes of financial investment productstypes of financial risk products.Specialist knowledgedescribe types of regulated emissions units, and their characteristics (encompassing carbon units, Australian carbon credit units (ACCU) and eligible international emissions units), including their status as personal property, and how they are typically derived from inception to the point of acquiring status as a financial product analyse risks associated with each type of regulated emission unit, including restrictions on their use, transfer and bankability for future use describe risk characteristics and mitigating strategies relative to regulated emissions including:regulatory riskdocumentation riskmarket and pricing riskfraudemerging market riskcounterparty riskexplain processes for acquiring, transferring and surrendering regulated emissions units, including compliance with the requirements of the Australian National Registry of Emissions Units analyse and summarise key features of the operation of carbon markets including:geopolitical context of carbon markets main participants in carbon markets, and their key objectives and participation behaviours as factors influencing market activity emissions unit supply and demand factors and regulated price factors influencing market activity and prices issue of carbon units via auction, and auction types types of transactions in carbon markets, including transactions relating to the carbon pricing mechanism and in voluntary markets, and the function of financial markets facilitating such trading including internationally potential trading strategies and their implementation in carbon markets including hedging and investment strategies risks associated with carbon markets including liquidity, pricing, credit, operational and regulatory risks carbon market transaction documentation including documentation used for different types of counterparties and transactions, their key terms and conditions, and advantages and disadvantages discuss the legal environment including disclosure and compliance covering:domestic regulatory framework for the carbon pricing mechanism, including the role of the Clean Energy Regulator and the Australian National Registry of Emissions Units domestic regulatory framework for the Carbon Farming Initiative, including the role of the Clean Energy Regulator and the Australian National Registry of Emissions Units international regulatory framework for carbon trading, including the Clean Development Mechanism relevant legal principles including Corporations Act, Australian Securities and Investments Commission (ASIC) Act and Privacy Amendment (Private Sector) Act relationship between ethics and regulatory requirements (good faith, utmost good faith, full disclosure of remuneration and/or fees and any other conflicts of interest that may influence the adviser’s recommendation), and application of these requirements in professional practice elements of the Registered Representatives Examination (where relevant)Chi-X Australia or Australian Securities Exchange (ASX) Operating Rules (where relevant)outline taxation issues in relation to carbon emissions products and markets in which they operate, and deductibility of costs associated with regulated emissions unitsoutline strategy development in an emissions marketplace including:evaluation of client objectives against risks concept development and evaluationexplain theories of investment, portfolio management and management of investment and risk:investment concepts and strategiesidentification of types of riskclient risk profile.