Which of the Following Is True About Analytical Tools Useful

question 9

Multiple Choice

Which of the following is true about analytical tools useful in "strategic" long horizon, big picture) and "tactical" shorter horizon, more specific) investment policy analysis for portfolio management?

• A) Modern portfolio theory MPT) is most useful for strategic analysis and equilibrium asset price modeling such as the CAPM) is most useful for tactical analysis.
• B) Modern portfolio theory MPT) is most useful for tactical analysis and equilibrium asset price modeling such as the CAPM) is most useful for strategic analysis.
• C) Both models are equally useful at both levels.
• D) Neither theory is very useful at either level.

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Definitions:

Shares Outstanding

The total number of shares of a corporation that have been issued and are held by shareholders, including restricted shares.

Ownership

The legal right or state of having control over property, assets, or a company.

Unknown Territory

New or unfamiliar areas, contexts, or situations that have not been previously explored or understood.

Venture Capital Investment

Funding provided by investors to startup companies and small businesses with perceived long-term growth potential.