Choose wisely. There is only one correct answer to each question.
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1.
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.
2.
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.
3.
The Internet can send you alerts to tell you when there are big changes in your investment holdings.
True. Some financial Websites will send you such alerts if you sign up for them.
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.
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.
