Which of the following statements about the mutual-fund theorem is true?

1. I) It is similar to the separation property.
2. II) It implies that a passive investment strategy can be efficient.
3. III) It implies that efficient portfolios can be formed only through active strategies.
4. IV) It means that professional managers have superior security-selection strategies.

Multiple Choice

• I and II

• III and IV

• I and IV

• II and IV

• I, II, and IV