Which of the following portfolio construction methods starts with security analysis?
A)Top-down
B)Bottom-up
C)Middle-out
D)Buy and hold

Question

Quizplus · Accepted Answer

Bottom-up portfolio construction starts with security analysis, where individual securities are analyzed and selected based on their fundamental strengths and weaknesses. This approach is also known as a stock-picking approach. Top-down, on the other hand, starts with an analysis of the overall economy and market trends before selecting securities. Middle-out is not a recognized portfolio construction method, and buy and hold is an investment strategy rather than a portfolio construction method.

Which of the Following Portfolio Construction Methods Starts with Security