Choose wisely. There is only one correct answer to each question.
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1.
When monitoring your investment portfolio, you would be wise to _______.
Develop a set of monitoring procedures. Approach your portfolio scientifically with a set of procedures, goals, and criteria.
2.
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.
3.
The best way to put an investment's performance into context is to compare its returns to those of _______.
An appropriate benchmark. Compare the returns of your investments to the benchmark you chose.
4.
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.
5.
What can happen if you ignore changes that occur in your portfolio?
Both of the above. Ignore changes in your portfolio and you may end up with a portfolio that's very different from the one you originally put together.
