Module 1: Getting to Know Your High-Net-Worth Client

Defining the High-Net-Worth Market: Understanding the segmentation of wealth (HNW, Ultra-HNW) and their unique service expectations.

Behavioral Finance: Identifying psychological biases (anchoring, loss aversion, overconfidence) and how they impact wealthy investors.

Communication Strategies: Tailoring the advisory relationship to family dynamics and multi-generational planning.

The Discovery Process: Detailed data gathering beyond traditional financial statements, focusing on values and legacy goals.

Module 2: Investment Risk, Return, and Performance

Modern Portfolio Theory (MPT): Application of MPT in the context of large, complex portfolios.

Risk Metrics: Analyzing Standard Deviation, Beta, Sharpe Ratio, and Treynor Ratio.

Performance Attribution: Evaluating how asset allocation versus security selection drives portfolio returns.

Investment Policy Statements (IPS): Drafting comprehensive IPS documents tailored to specific HNW constraints and objectives.

Module 3: Advanced Investment Products and Strategies

Alternative Investments: Detailed study of Private Equity, Hedge Funds, and Real Estate Investment Trusts (REITs).

Derivatives and Hedging: Using options (puts, calls, collars) and futures to manage concentrated stock positions.

Structured Products: Understanding the mechanics of market-linked notes and principal-protected investments.

Tax-Managed Investing: Strategies such as tax-loss harvesting and the use of low-turnover funds to maximize after-tax returns.

Module 4: Considerations for Business Owners

Business Valuation: Overview of methods including discounted cash flow and market-based multiples.

Succession Planning: Strategies for transitioning ownership, including buy-sell agreements and family limited partnerships.

Exit Strategies: Analyzing Initial Public Offerings (IPOs), management buyouts, and third-party sales.

Cash Flow Management: Balancing personal wealth with the capital needs of a closely-held business.

Module 5: Income Tax Strategies for High-Net-Worth Clients

Tax Legislation: Analysis of the current tax code, including brackets, capital gains, and the Alternative Minimum Tax (AMT).

Passive Activity Rules: Understanding the impact of passive losses and credits on high-income earners.

Charitable Giving: Technical execution of Donor-Advised Funds, Private Foundations, and Charitable Lead/Remainder Trusts.

Cost Basis Management: Advanced tracking and planning for stepped-up basis and gifted assets.

Module 6: Executive Benefits Planning

Stock-Based Compensation: Detailed planning for Incentive Stock Options (ISOs), Non-Qualified Stock Options (NQSOs), and Restricted Stock Units (RSUs).

Non-Qualified Deferred Compensation (NQDC): Evaluating the risks and rewards of 409A plans.

Net Unrealized Appreciation (NUA): Calculating the benefits of taking company stock distributions from qualified plans.

Section 83(b) Elections: Timing and tax implications for early-stage executive equity.

Module 7: Estate Planning for High-Net-Worth Clients

The Transfer Tax System: Federal gift, estate, and generation-skipping transfer (GST) taxes.

Advanced Trust Structures: Mechanics of Grantor Retained Annuity Trusts (GRATs), Intentionally Defective Grantor Trusts (IDGTs), and Irrevocable Life Insurance Trusts (ILITs).

Asset Protection: Strategies to shield wealth from creditors through domestic and offshore structures.

Philanthropic Legacy: Incorporating social impact and family values into the estate plan.

Module 8: Fiduciary and Regulatory Issues

Standard of Care: Differentiating between the Fiduciary Standard and the Suitability Standard (Regulation Best Interest).

Regulatory Compliance: Understanding SEC and FINRA oversight, including ADV disclosures.

Ethics and Professional Conduct: Adhering to the College for Financial Planning’s Standards of Professional Conduct.

Privacy and Cyber Security: Protecting sensitive HNW client data in a digital environment.

Exam Format and Preparation Notes

Duration: 3 Hours.

Total Questions: 80 Multiple-choice questions.

Passing Score: 70% or higher.

Attempt Limit: A maximum of two attempts are typically permitted within the 120-day enrollment period.

Practice Exam Utility: The practice exam is designed to mirror the final's difficulty and weightage across the eight modules listed above.