Under the Efficient Market Hypothesis (EMH), the major effort of the portfolio manager should be to:
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A) |
achieve complete diversification of the portfolio. |
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B) |
maximize transactions costs. |
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C) |
help clients underperform the market benchmark. |
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D) |
maintain the same investment plan over time. |
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The correct answer was A) achieve complete diversification of the portfolio.
In an efficient market, portfolio managers must create and maintain the appropriate mix of assets to meet their client’s needs. The portfolio should be diversified to eliminate unsystematic risk. Over time the needs of the client and environment will justify changes to the portfolio. The manager should also try to minimize transaction costs and at least try to match the performance of a benchmark. | 
发表于 2006-4-27 14:52
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