What is the main goal of portfolio management?
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Wrong!
Portfolio management aims to balance risk and return to meet investor objectives.
What does asset allocation determine?
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Asset allocation divides investments among asset categories to manage risk.
Why is diversification important?
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Diversification spreads risk across various investments to reduce overall portfolio risk.
What is rebalancing in portfolio management?
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Rebalancing adjusts portfolio weights to maintain target asset allocation.
What is systematic risk?
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Systematic risk affects the entire market and cannot be diversified away.
Which strategy aims to outperform market benchmarks?
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Active management tries to beat market performance through active trading.
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What does a benchmark provide?
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Benchmarks offer a standard to compare portfolio performance.
What is the primary role of a portfolio manager?
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The portfolio manager manages assets to meet investor objectives within risk tolerance.
What is meant by risk-adjusted return?
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Wrong!
Risk-adjusted return measures returns relative to the risk taken.