Consider the Theory of Active Portfolio Management

question 3

Multiple Choice

Consider the theory of active portfolio management.Stocks A and B have the same beta and non-systematic risk.Stock A has higher positive alpha than stock B. You should want __________ in your active portfolio.

• A) equal proportions of stocks A and B
• B) more of stock A than stock B
• C) more of stock B than stock A
• D) more information is needed to answer this question

---

Definitions:

Cause-Related Marketing

A marketing strategy where companies associate with social issues or causes to promote their products while also contributing to a societal goal.

Core Competencies

Unique strengths and abilities of a company that provide a competitive advantage and are difficult for competitors to imitate.

Societal Benefits

Refers to advantages or positive impacts that actions, policies, or products have on the wider community or society as a whole.

Unfair Competition

Practices that are unjust or deceptive in the marketplace, infringing on the rights of others to conduct business freely and equitably.