{"id":59356,"date":"2024-04-16T01:35:46","date_gmt":"2024-04-16T01:35:46","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=59356"},"modified":"2024-04-16T01:35:46","modified_gmt":"2024-04-16T01:35:46","slug":"which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/","title":{"rendered":"Which of the following is true regarding the expected return of a portfolio?"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;It is a weighted average only for stock portfolios&#8221; option2=&#8221;It can only be positive&#8221; option3=&#8221;It can never be above the highest individual return&#8221; option4=&#8221;All of the above are true&#8221; correct=&#8221;option4&#8243;]<!--more--><\/p>\n<p>The correct answer is: <strong>D. All of the above are true.<\/strong><\/p>\n<p>The expected return of a portfolio is a weighted average of the expected returns of the individual assets in the portfolio. The weights are determined by the portfolio&#8217;s asset allocation. The expected return of a portfolio can only be positive if the expected returns of the individual assets in the portfolio are all positive. The expected return of a portfolio can never be above the highest individual return in the portfolio.<\/p>\n<p>Here is a more detailed explanation of each option:<\/p>\n<ul>\n<li>Option A: The expected return of a portfolio is a weighted average of the expected returns of the individual assets in the portfolio. The weights are determined by the portfolio&#8217;s asset allocation. For example, if a portfolio is 50% invested in stocks and 50% invested in bonds, the expected return of the portfolio will be the weighted average of the expected returns of stocks and bonds. The weights are determined by the portfolio&#8217;s asset allocation. If the portfolio is 50% invested in stocks and 50% invested in bonds, the weights would be 0.5 and 0.5, respectively.<\/li>\n<li>Option B: The expected return of a portfolio can only be positive if the expected returns of the individual assets in the portfolio are all positive. This is because the expected return of a portfolio is a weighted average of the expected returns of the individual assets in the portfolio. If any of the expected returns of the individual assets are negative, the expected return of the portfolio will also be negative.<\/li>\n<li>Option C: The expected return of a portfolio can never be above the highest individual return in the portfolio. This is because the expected return of a portfolio is a weighted average of the expected returns of the individual assets in the portfolio. The weights are determined by the portfolio&#8217;s asset allocation. If the portfolio is 50% invested in stocks and 50% invested in bonds, the expected return of the portfolio will be the weighted average of the expected returns of stocks and bonds. The weights are determined by the portfolio&#8217;s asset allocation. If the portfolio is 50% invested in stocks and 50% invested in bonds, the weights would be 0.5 and 0.5, respectively. The expected return of the portfolio cannot be above the highest individual return in the portfolio, which is the expected return of stocks.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;It is a weighted average only for stock portfolios&#8221; option2=&#8221;It can only be positive&#8221; option3=&#8221;It can never be above the highest individual return&#8221; option4=&#8221;All of the above are true&#8221; correct=&#8221;option4&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-59356","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Which of the following is true regarding the expected return of a portfolio?<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Which of the following is true regarding the expected return of a portfolio?\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;It is a weighted average only for stock portfolios&#8221; 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option2=&#8221;It can only be positive&#8221; option3=&#8221;It can never be above the highest individual return&#8221; option4=&#8221;All of the above are true&#8221; correct=&#8221;option4&#8243;]","og_url":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2024-04-16T01:35:46+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/","url":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/","name":"Which of the following is true regarding the expected return of a portfolio?","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2024-04-16T01:35:46+00:00","dateModified":"2024-04-16T01:35:46+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/which-of-the-following-is-true-regarding-the-expected-return-of-a-portfolio\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"Financial management","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/financial-management\/"},{"@type":"ListItem","position":3,"name":"Which of the following is true regarding the expected return of a portfolio?"}]},{"@type":"WebSite","@id":"https:\/\/exam.pscnotes.com\/mcq\/#website","url":"https:\/\/exam.pscnotes.com\/mcq\/","name":"MCQ and Quiz for Exams","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/exam.pscnotes.com\/mcq\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209","name":"rawan239","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","caption":"rawan239"},"sameAs":["https:\/\/exam.pscnotes.com"],"url":"https:\/\/exam.pscnotes.com\/mcq\/author\/rawan239\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/59356","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/comments?post=59356"}],"version-history":[{"count":0,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/59356\/revisions"}],"wp:attachment":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/media?parent=59356"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/categories?post=59356"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/tags?post=59356"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}