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11 Cards in this Set
- Front
- Back
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active investment strategy
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the goal of this strategy is to outperform a benchmark portfolio on a risk adjusted basis.
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benchmark
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managers often measure against this predetermined number that was specified in an investment policy statement.
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bottom up analysis
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an investment approach that seeks out undervalued companies. a fund manager may find companies whose low share prices are not justified. they would buy these securities and when the market finally realizes that they are undervalued, the share price rises giving the astute bottom up manager a profit.
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dynamic asset allocation
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an asset allocation strategy that refers to the systematic rebalancing, either by time period or weight, of the securities in the portfolio, so that they match the long-term benchmark asset mix among the various asset classes.
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indexing
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a portfolio management style that involves buying and holding a portfolio of securities that matches, closely or exactly, the composition of a benchmark index.
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integrated asset allocation
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an asset allocation strategy that refers to an all encompassing strategy that includes consideration of capital market expectations and client risk tolerance.
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sector rotation
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this type of rotation applies a top down approach, focusing on analyzing the prospects for the overall economy.
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sharpe ratio
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this type of ratio is used by mutual fund companies and portfolio managers to compare the return of a portfolio to the risk-less rate of return, taking the portfolio's risk into account.
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strategic asset allocation
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this base policy mix is the long term mix that will be adhered to by monitoring and, when necessary, rebalancing.
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tactical asset allocation
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an asset allocation strategy that involves adjusting a portfolio to take advantage of perceived inefficiencies in the prices of securities in different asset classes or within sectors.
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top down analysis
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a type of fundamental analysis. first, general trends in the economy are analyzed. this information is then combined with industries and companies within those industries that should benefit from the general trends identified.
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