If the markets are efficient, then asset allocation is __________ and security selection is __________.
A) still important; less important
B) still important; still important
C) still important; extremely critical
D) not important; less important
E) not important; still important

Question

Quizplus · Accepted Answer

Even if markets are efficient, asset allocation remains important for managing risk and achieving diversification. However, security selection is less important because it is harder to consistently outperform the market in an efficient market environment.

If the Markets Are Efficient, Then Asset Allocation Is __________