Portfolio Performance Is Often Decomposed into Various Subcomponents Such as the Return

question 43

Multiple Choice

Portfolio performance is often decomposed into various subcomponents such as the return due to ________.
I. broad asset allocation across security classes
II. sector weightings within equity markets
III. security selection with a given sector
The decision that contributes most to the fund performance is:

• A)I
• B)II
• C)III
• D)All contribute equally to fund performance

---

Definitions:

Horizontal Axis

In a graph or chart, the horizontal axis is typically used to represent the independent variable or the base measurement.

Vertical Axis

In a graph or chart, the vertical line or axis is typically used to represent the range of values for a dependent variable.

Consumption

The action of using up a good or service, typically one that satisfies human desires or needs.

Units

Standardized quantities used to measure, count, or quantify objects or phenomena.