Perfect timing ability is equivalent to having __________ on the market portfolio.

Question

Quizplus · Accepted Answer

Perfect timing ability in the market allows the investor to capture a maximum return from the portfolio. This is equivalent to having a call option, which gives the holder the right to buy the underlying asset at a predetermined price. With perfect timing ability, the investor can buy the asset at a low price and sell it at a high price, thus maximizing their return. Therefore, option A) is the best choice.

Perfect Timing Ability Is Equivalent to Having __________ on the Market