Choose wisely. There is only one correct answer to each question.
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1.
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.
2.
What should you do if your portfolio's returns fall short of your expected performance over a short period of time?
Don't panic, but do find out why your portfolio isn't meeting expectations--especially if your portfolio is suffering losses that are beyond your acceptable range. Your portfolio should average out to your expected return figure over time, not return that exact amount each and every year. But you should find out what's driving your portfolio's performance. And if your portfolio is actually losing more money than you thought it could, you may be taking on more risk than you think.
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.
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.
