Research of actively managed portfolios,managed by professional portfolio managers:
A) indicates that one should not randomly select managed portfolios managed by professional portfolio managers.
B) indicates that historical performance is a good indicator of future performance.
C) indicates that professional management provides investors with superior market returns.
D) indicates the majority of professional portfolio managers outperform the market.

Question

Quizplus · Accepted Answer

Research on actively managed portfolios suggests that randomly selecting managed portfolios managed by professional portfolio managers is not a good strategy. This is because past performance is not always indicative of future results, and there is a lack of consistency in performance across different managers. Therefore, investors should look for other factors beyond historical performance to evaluate the potential of a professional manager.

Research of Actively Managed Portfolios,managed by Professional Portfolio Managers