In Equity Portfolio Management,tracking Error Occurs When

question 3

Multiple Choice

In equity portfolio management,tracking error occurs when

• A) The managed portfolio outperforms the benchmark portfolio.
• B) The managed portfolio under performs the benchmark portfolio.
• C) The return volatility of the managed portfolio is positively correlated with the return volatility of the benchmark portfolio.
• D) The return volatility of the managed portfolio is negatively correlated with the return volatility of the benchmark portfolio.
• E) The return volatility of the managed portfolio is not correlated with the return volatility of the benchmark portfolio.

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