Question
The reasons for creating a Strategic Asset Allocation for retail investors based on allocating risk rather than on allocating returns include all of the following,
The reasons for creating a Strategic Asset Allocation for retail investors based on allocating risk rather than on allocating returns include all of the following, except:
Group of answer choices
A.Historical volatility is a good measure/predictor of future volatility of each asset in the portfolio
B. Risk Parity based SAA are better diversified than equal $ allocated SAA.
C. Creating an SAA based on optimising returns against risk may not allocate to investments that are important in a portfolio
D.Historical returns of each asset in the portfolio is not a good predictor of future returns of each asset in the portfolio
E. Retail investors better understand their desired level of volatility rather than their desired required returns.
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