In an investment policy statement the objectives of an investor are expressed in terms of risk and return risk return time horizon liquidity needs 2 Which of the following is not a step in the...

ASSET ALLOCATION 1 In an investment policy statement the objectives of an investor are expressed in terms of risk and return risk return time horizon liquidity needs 2Which of the following is not a step in the portfolio management process? a)Develop a policy statement. b)Study current financial and economic conditions. c)Construct the portfolio. d)Monitor investor's needs and market conditions. e)Sell all assets and reinvestment proceeds at least once a year. 3The first step in the investment process is the development of a(n) a)Objective statement. b)Policy statement. c)Financial statement. d)Statement of cash needs. Statement of cash flows. 4Which of the following is not considered to be an investment objective? a)Capital preservation b)Capital appreciation c)Current income d)Total return e)None of the above (that is, all are considered investment objectives) (5 must be stated in terms of expected returns and risk. An investor's tolerance for risk must be established before returns objectives can be stated. a)Investment requirements b)Investment constraints c)Investment rewards d)Investment objectives Investment policy 6_______________ is an appropriate objective for investors who want their portfolio to grow in real terms, i.e., exceed the rate of inflation. a)Capital preservation b)Capital appreciation c)Portfolio growth d)Value additivity e)Nominal preservation 7___________ refer(s) to the ability to convert assets to cash quickly and at a fair market price and often increase(s) as one approaches the later stages of the investment life cycle. a)Liquidity needs b)Time horizons c)Liquidation values d)Liquidation essentials Capital liquidations 8The policy statement may include a __________ against which a portfolio's or portfolio manager's performance can be measured. a)Milestone b)Benchmark c)Landmark d)Reference point Market...