CFA Level I · CFA Level I Exam · Portfolio Management: An Overview
Which task is most likely part of the execution step of the portfolio management process?
Selecting securities and trading them to implement the target allocation belongs to execution. Execution builds the portfolio from the plan. Determining objectives and risk tolerance and forming capital market expectations are planning tasks that happen beforehand.
- AAnalyzing economic and market conditions to form capital market expectations
- BDetermining the client's return objective and risk tolerance
- CSelecting securities and trading them to implement the target allocationCorrect
Explanation
Execution turns the plan into a portfolio through security selection and trading. Return and risk objectives belong to planning, as does forming capital market expectations used for the strategic allocation.
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