Why Is It So Difficult to Identify a Group of Assets

question 29

Multiple Choice

Why is it so difficult to identify a group of assets or other techniques that can fully eliminate portfolio risk?

• A)They types of assets that can eliminate portfolio risk are only available to professional money managers
• B)The lack of a full hedge for the lifetime work-related income streams we call human assets
• C)The volatility of portfolio returns over time
• D)All of the above
• E)None of the above

---

Definitions:

Budgeted Income Statement

A financial projection that estimates a company's revenue and expenses over a specific future period, predicting net income or loss.

Budgeted Balance Sheet

A financial statement projecting the future financial position of a company, based on expected assets, liabilities, and equity.

Continuous Budget

A 12-month budget that rolls forward one month as the current month is completed.

Rolls Forward

A process in accounting or financial planning where data or balances are brought forward from a previous period to the current one.