CFA Level I · CFA Level I Exam · Portfolio Management: An Overview
In the portfolio management process, the step in which the manager sets out the client's objectives, constraints and the strategic asset allocation is most likely the:
The planning step is correct. In it the manager learns the client's objectives and constraints, writes them into an investment policy statement, and sets the strategic asset allocation. Execution then builds the portfolio, and feedback monitors and rebalances it.
- Aexecution step
- Bplanning stepCorrect
- Cfeedback step
Explanation
The planning step identifies client needs, documents them in an investment policy statement, and sets the strategic asset allocation. Execution is where the portfolio is built and trades are made, and feedback is where performance is monitored and the plan is rebalanced.
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