A Discretionary Account

question 97

Multiple Choice

A discretionary account:

• A)authorizes a broker to trade securities on your behalf.
• B)charges an annual fee to cover all trading and management services.
• C)is the term applied to brokerage accounts with check-writing and credit card services.
• D)is the same as a wrap account.
• E)is the account used to pledge securities as collateral for a margin loan.

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Definitions:

Down-Market Betas

Measures of how securities or portfolios perform relative to a benchmark during market downturns, reflecting their sensitivity to negative market movements.

Up-Market Betas

Measures of an asset's sensitivity to market movements, particularly during periods of rising market prices.

Geometric Average Return

The average rate of return on an investment per year, compounded annually, over a specified time period.

Arithmetic Return

The simple average of a series of returns generated over a period of time.