ACC Charge
Why is Class 6 excluded from the ACC charge? If they are the riskiest assets (junk rated) shouldn't there be a more egregious penalty for having them in your investment portfolio?
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Why is Class 6 excluded from the ACC charge? If they are the riskiest assets (junk rated) shouldn't there be a more egregious penalty for having them in your investment portfolio?
Comments
I see the following comment on Odomirok page 261:
". . . However, not all assets are subject to the asset concentration factor, as certain assets are deemed to be of low risk or have already received the maximum charge of 0.300. The assets excluded from the additional charge are also excluded in determining the 10 largest issuers. . . ."
Class 6 bonds already have an RBC charge of 0.30, so that must be why they are excluded from ACC.