Limiting Your Investments to the Top Six Countries in the World

question 13

Multiple Choice

Limiting your investments to the top six countries in the world in terms of market capitalization may make sense for a/an _________ investor but probably does not make sense for a/an ________ investor.

• A) active; passive
• B) passive; active
• C) security selection expert; market timer
• D) fundamental; technical

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Definitions:

Certainty

The state or quality of being absolutely sure or confident about something, without any doubt.

Perfect Information

A market condition in which all participants are fully informed about the product, prices, and other relevant factors.

Uncertainty

The degree to which a measured value varies from the true value, often due to limitations in measurement or knowledge.

Expected Opportunity Loss

The anticipated loss in value resulting from foregoing the best course of action, often used in decision-making processes under uncertainty.