The ex post characteristic line for a successful market timer will be
A) flat.
B) quadratic with positive slope.
C) linear with a negative slope.
D) quadratic with negative slope.

Question

Quizplus · Accepted Answer

A successful market timer's ex post characteristic line will be quadratic with a positive slope because it reflects the ability to outperform the market by adjusting the portfolio based on anticipated market movements, leading to higher returns in both rising and falling markets.

The Ex Post Characteristic Line for a Successful Market Timer