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Question 7B

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Essentials Of Investments
Found in: Page 258
Essentials Of Investments

Essentials Of Investments

Book edition 9th
Author(s) Zvi Bodie, Alex Kane, Alan Marcus, Alan J. Marcus
Pages 748 pages
ISBN 9780078034695

Short Answer

In an efficient market, professional portfolio management can offer all of the following benefits except which of the following?

a. Low-cost diversification.

b. A targeted risk level

c. Low-cost record keeping.

d. A superior risk-return trade-off.

The correct answer is d.

See the step by step solution

Step by Step Solution

Definition

The “professional portfolio management” refers to the advanced level of competence in management of one or more portfolios to achieve strategic objective.

Explanation

In an efficient market, it is not possible to offer a high risk return trade-off; hence the correct answer option is d.

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