Which of the following statements accurately represents what clients can do to ensure that their portfolios reflect their own specific risk-return preferences?
A) Clients need to develop monitoring procedures to evaluate their manager's investment activities relative to predefined goals and constraints
B) Clients need not pay very close attention to their investment objectives if they have an effective relationship with their manager
C) The client will have to subordinate their individual preferences to all the clients in the management firm for optimal results.
D) Rather than give overly detailed investment objectives, the client should be prepared to allow their manager to interpret for them the optimal tradeoff between risk and return

Question

Quizplus · Accepted Answer

Clients need to actively monitor their manager's investment activities to ensure that their portfolios reflect their risk-return preferences. This involves evaluating the manager's performance relative to predefined goals and constraints. Clients should not rely on their relationship with the manager alone, and should assert their individual preferences. Additionally, clients should not subordinate their preferences to the preferences of other clients in the management firm, as this would not lead to optimal results. Finally, clients should be clear and specific about their investment objectives in order to maximize the chances of achieving their desired risk-return tradeoff.

Which of the Following Statements Accurately Represents What Clients Can