Choose wisely. There is only one correct answer to each question.
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1.
If you've created an investment policy statement, you will have addressed which of these portfolio-monitoring issues?
All of the above. If you've created an investment policy statement, you will have addressed these questions and many others.
2.
The best way to put an investment's performance into context is to compare its returns to those of other investments in your portfolio.
False. The best way to do it is to compare its returns to an appropriate benchmark.
3.
Which of the following would be valuable to do before you start monitoring your investment portfolio?
Both of the above. Both of these are wise things to do. Though you can develop your monitoring procedures on your own, creating an investment policy statement would accomplish that as well as additional objectives.
4.
Portfolios _______.
Both of the above. Portfolios can change without us doing anything to them. Market forces will make some investments perform better than others, which means they'll take up more of our assets. Or fund managers buy and sell securities, thereby changing the underlying portfolios of our mutual funds and, therefore, changing the look of our overall portfolios.
5.
If a mutual fund no longer meets one of your investment criteria, should you sell it?
Maybe, maybe not. It becomes a more important issue once it no longer meets most of your criteria.
