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The Discretionary Investment Management Agreement is a crucial document used when a client wishes to delegate investment management authority to a professional investment manager licensed by the Hong Kong Securities and Futures Commission (SFC). This agreement is essential for establishing a clear framework for the investment management relationship, ensuring compliance with Hong Kong regulatory requirements, and protecting both parties' interests. It outlines the manager's authority to make investment decisions without prior client consultation, while setting clear boundaries through investment guidelines, risk parameters, and reporting obligations. The agreement is particularly important in Hong Kong's sophisticated financial markets, where it must comply with specific regulatory requirements including the Securities and Futures Ordinance and various SFC codes and guidelines. It includes detailed provisions on fee structures, custody arrangements, client classifications, and risk disclosures, making it suitable for both institutional and high-net-worth individual clients.

1. Parties: Identification of the investment manager and the client, including their respective regulatory status and contact details

2. Background: Context of the agreement and brief description of the services to be provided

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. Appointment and Authority: Formal appointment of the investment manager and scope of discretionary authority

5. Investment Objectives and Restrictions: Client's investment objectives, risk profile, and any investment restrictions

6. Services: Detailed description of investment management services, including portfolio management and reporting obligations

7. Client Representations and Warranties: Client's confirmations regarding their status, authority, and understanding of risks

8. Manager Representations and Warranties: Manager's confirmations regarding licensing, expertise, and regulatory compliance

9. Fees and Expenses: Management fees, performance fees, and other charges, including calculation methods and payment terms

10. Custody Arrangements: Details of custody arrangements and handling of client assets

11. Reporting and Valuations: Frequency and content of portfolio reports, valuation methods, and performance measurement

12. Conflicts of Interest: Disclosure and management of potential conflicts of interest

13. Liability and Indemnification: Extent of manager's liability and mutual indemnification provisions

14. Term and Termination: Duration of agreement, termination rights, and consequences of termination

15. Confidentiality: Protection and handling of confidential information

16. Notices: Methods and requirements for formal communications between parties

17. General Provisions: Standard contractual provisions including governing law, amendments, and assignment