A long-term institutional investor has set a strategic asset allocation of 50% Canadian equities, 20% International equities, and 30% Fixed Income. This allocation was determined after a thorough analysis of their risk tolerance, investment horizon, and liabilities, and is only reviewed every three to five years. This approach reflects which of the following?

Question: A long-term institutional investor has set a strategic asset allocation of 50% Canadian equities, 20% International equities, and 30% Fixed Income. This allocation was determined after a thorough analysis of their risk tolerance, investment horizon, and liabilities, and is only reviewed every three to five years. This approach reflects which of the following?

Answer options:

• Tactical Asset Allocation
• Active Portfolio Management ✅ Strategic Asset Allocation
• Asset-Liability Matching

Correct answer: Strategic Asset Allocation

Explanation: Strategic asset allocation is the long-term, target allocation of investment assets across different asset classes. It's based on an investor's fundamental objectives, risk tolerance, and time horizon, and is typically reviewed infrequently, indicating its long-term nature.