Timing is the important factor in which portfolio management strategy?
a. strategic allocation
b. tactical allocation
c. rebalancing
d. indexing

Respuesta :

The correct answer is b: tactical allocation. Timing is the important factor in tactical allocation of portfolio management strategy.

In order to accomplish a set of strategic goals, strategic portfolio management involves the selection and prioritization of programs and projects, as well as the matching of resource availability with resource demand. The main focus of SPM is selecting the appropriate projects in accordance with a predetermined set of business drivers.

An active management portfolio technique known as tactical asset allocation changes the percentage of assets held in different categories to profit from anomalies in market pricing or robust market sectors. By taking advantage of particular market conditions, this method enables portfolio managers to add value. As soon as they achieve the intended short-term profits, managers return to the portfolio's original asset mix, making it a moderately active strategy.

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