Choose wisely. There is only one correct answer to each question.
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1.
Investment selection criteria are _______.
Both of the above. Develop your investment selection criteria as rules for choosing investments. Then, as you monitor your portfolio, make sure that your investments continue to hold the qualities that you bought them for. If they don't, consider selling.
2.
The Monitoring Procedures portion of your investment policy statement details _______.
How you will keep tabs on your investments. This the section in which you keep your document accurate and current.
3.
What benchmark is most appropriate for a portfolio that is 50% invested in U.S. large-company stocks, 25% in bonds, and 25% in foreign stocks?
A customized benchmark that combines U.S. large-company, bond, and foreign-stock indexes. Choose benchmarks for your portfolio that reflect the makeup of your portfolio.
4.
The investment philosophy section of your investment policy statement tells you _______.
What is important to you as an investor. This section tends to be subjective.
5.
The investment objectives portion of your investment policy statement covers _______.
What you're trying to achieve with your portfolio and in what time frame. It's all about goals.
