Choose wisely. There is only one correct answer to each question.
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1.
When its time to rebalance your portfolio, which is the most likely to happen?
Youll probably have to increase your cash/bond position and decrease your stock position. Most of the time, stocks outperform cash and bonds. As a result, youll usually have to cut back your stock position when you rebalance.
2.
To determine whether your existing portfolio fits your investing blueprint, you should, among other things, search for overlap among your investments.
True. Searching for overlap will weed out unneeded redundancy.
3.
Why might it be a good idea to remove redundant investments from your portfolio?
All of the above. Though a set of investments may be redundant, there are still some differences among them, which may make one preferable to keep over the others.
4.
When creating a blueprint for your investment portfolio, what should you start with?
Your goal. Your goal gives you vital information, such as how long youll be investing and how much money you can put at risk.
5.
You will want to keep tabs on your individual investments in order to make sure theyre _______.
Still filling their original roles in your portfolio. Changes in management, style, and other factors can alter how well your investments are working for you.