Chartered Investment Manager (CIM) Practice Exam · Question
A portfolio holds a diversified mix of Canadian large-cap equities and fixed income. Which of the following would be the most appropriate blended benchmark for performance comparison?
A diversified portfolio with equities and fixed income requires a blended benchmark reflecting its asset allocation. The custom benchmark weights the S&P/TSX Co
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Question: A portfolio holds a diversified mix of Canadian large-cap equities and fixed income. Which of the following would be the most appropriate blended benchmark for performance comparison?
Answer options:
- S&P/TSX Composite Index
- S&P 500 Index (CAD Hedged) ✅ A custom benchmark composed of 60% S&P/TSX Composite Index and 40% FTSE Canada Universe Bond Index
- MSCI World Index
Correct answer: A custom benchmark composed of 60% S&P/TSX Composite Index and 40% FTSE Canada Universe Bond Index
Explanation: A diversified portfolio with equities and fixed income requires a blended benchmark reflecting its asset allocation. The custom benchmark weights the S&P/TSX Composite Index for Canadian large-cap equities and the FTSE Canada Universe Bond Index for fixed income, providing a relevant comparison.
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