Abstract

The unique advantages of trust system in wealth management and inheritance have been universally recognized. With the continuous rapid growth of China's economy and the accumulation of social wealth, and the peak of the succession of entrepreneurs and the demand for the inheritance of wealth has begun to flourish. At present many trust companies consider family trust as one of the important direction for strategic transformation and innovation, but the existing financing services model is not match with the family trust business, needs to renew and construct the new business structure.

This study combs life cycle theory, modern portfolio theory, the prudent investor rule based on the theory and literature, and analyzes the development characteristics of the family trust market in China, combining with industry research, and sorting out the business practices of the trust company's family trust business. Then the paper focuses on three key points in family trust operation, such as product design, investment management and asset allocation. In the topic of product design, the paper introduces the special requirements of family trust customer identification and due diligence, and transfer and delivery of non-cash special assets such as equity, real estate. In the topic of investment management, the paper provides the rules of trust cautious investment framework, which includes investment objectives and principles, trust investment strategy, asset allocation strategy, investment operations and risk management rules, etc. In the topic of asset allocation, the paper analyzes from the macro configuration and micro configuration. At the macro configuration level, this paper sorts out the theory of asset allocation theory, and focuses on the method of risk evaluation strategy, and analyzes its application in family trust asset allocation. Configuration in the microscopic levels, emphasizing the trust companies should foster strengths and circumvent weaknesses, to be familiar with the non-standard creditor's rights financing business domain independent investment, but in view of the standardized products such as stocks, bonds, art, precious metals, commodities and other alternative investments, the trustee need to use the power of the external professional investment managers, through FOF and MOM innovation model.

The main features and innovative pointsinclude as follows:Firstly, it systematically discusses the special requirements of family trust business int complex purpose of trust, property and assets management. Secondly, it introduces the special requirements of family trust customer due diligence, and transfer and delivery of non-cash special assets such as equity, real estate. Thirdly, provides the rules of trust cautious investment framework. Fourthly, it discusses asset allocation in family trust from macro and micro aspects, respectively based on the categories of asset allocation theory, FOF and MOM management mode are analyzed.

Keywords: Family Trust, Product Desigh, Asset Allocation, Investent Management