Choose wisely. There is only one correct answer to each question.
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1.
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.
2.
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.
3.
What is the danger in letting the strongest performers of your portfolio stay in there and continue performing, as opposed to regular rebalancing?
It increases the overall risk level, which can magnify losses during a downturn. And that means you might not meet the goals for which you are investing in the first place.
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.
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.
