1. Answer TRUE or FALSE a) Every investor is aiming for the largest possible portfolio return he/she can achieve over his investment horizon b) Different investors have different risk appetite / risk aversion when it comes to investing capital for the long term c) Investors and Portfolio Managers who act as investor fiduciaries need to be on the same page and agree on specific investment guidelines that govern the client-manager relationship d) All Portfolio Managers are paid according to investment returns they achieve e) Hedge Fund and Private Equity portfolio managers are paid according to the excess returns they generate and deliver f) Interest rates impact portfolio returns g) The Tangent Portfolio risk-return profile does not depend on the level of interest rates h) For a given level of risk, one can hold a portfolio that sits above the efficient frontiere for a given period of time (super-efficient portfolio) i) To create market-neutral portfolios, we should only look for assets that show little to no corellation with the market return j) Asset Allocation where short sales and leverage (borrowing) is allowed can potentially generate risk-adjusted returns potentially higher than the ones of the Tangent Portfolio 1. Answer TRUE or FALSE a) Every investor is aiming for the largest possible portfolio return he/she can achieve over his investment horizon b) Different investors have different risk appetite / risk aversion when it comes to investing capital for the long term c) Investors and Portfolio Managers who act as investor fiduciaries need to be on the same page and agree on specific investment guidelines that govern the client-manager relationship d) All Portfolio Managers are paid according to investment returns they achieve e) Hedge Fund and Private Equity portfolio managers are paid according to the excess returns they generate and deliver f) Interest rates impact portfolio returns g) The Tangent Portfolio risk-return profile does not depend on the level of interest rates h) For a given level of risk, one can hold a portfolio that sits above the efficient frontiere for a given period of time (super-efficient portfolio) i) To create market-neutral portfolios, we should only look for assets that show little to no corellation with the market return j) Asset Allocation where short sales and leverage (borrowing) is allowed can potentially generate risk-adjusted returns potentially higher than the ones of the Tangent Portfolio