Chartered Investment Manager (CIM) Practice Exam · Question
When conducting performance attribution, what is the primary purpose of breaking down a portfolio's return?
Performance attribution aims to explain how a portfolio's return was achieved relative to its benchmark, typically by dissecting the contribution of asset alloc
Start free practice for Chartered Investment Manager (CIM) Practice Exam
399 questions · no signup required · 40 free questions per day
Question: When conducting performance attribution, what is the primary purpose of breaking down a portfolio's return?
Answer options:
- To identify the individual securities that contributed most to the portfolio's total return. ✅ To determine whether the portfolio outperformed its benchmark due to asset allocation, security selection, or other factors.
- To calculate the total management fees incurred by the portfolio.
- To compare the portfolio's risk profile against that of its benchmark.
Correct answer: To determine whether the portfolio outperformed its benchmark due to asset allocation, security selection, or other factors.
Explanation: Performance attribution aims to explain how a portfolio's return was achieved relative to its benchmark, typically by dissecting the contribution of asset allocation, security selection, and currency movements.
Start free practice for Chartered Investment Manager (CIM) Practice Exam
399 questions · no signup required · 40 free questions per day
More about Chartered Investment Manager (CIM) Practice Exam
Related Questions
- Strategic asset allocation is:
- Modern Portfolio Theory introduced by:
- A client approaches you, a CIM-credentialed portfolio manager, wanting to understand the true cost of their mu
- Duration measures bond sensitivity to:
- Which of the following is an example of an alternative investment?
- An investment advisor's foremost duty to a client is to act in their best interest, placing the client's inter
More for Chartered Investment Manager (CIM) Practice Exam candidates
Ready to practice?
Free, no signup required. Build a wrong-question list as you go.
Start Free Chartered Investment Manager (CIM) Practice Exam Practice →Related courses
Other Canadian certifications candidates often prepare for alongside this one.