Strategic asset allocation determines:

A Daily trades

B Long-term target weights based on investors objectives, risk tolerance, and constraints

C Single stock picks

D Market timing

✓ Correct Answer: Option B

Strategic allocation: long-term policy mix (e.g., 60/40 equity/bond). Tactical allocation makes short-term deviations.

💡 Why is B) the correct answer?

The correct answer to the question "Strategic asset allocation determines:" is Option B: Long-term target weights based on investors objectives, risk tolerance, and constraints.

The other options — A) Daily trades, C) Single stock picks, D) Market timing — are incorrect for this CFA Exam Prep question. As explained above: Strategic allocation: long-term policy mix (e.g., 60/40 equity/bond). Tactical allocation makes short-term deviations.

📚 About This CFA Exam Prep Practice Question

This 2-level CFA Exam Prep question from the Portfolio Management topic is part of BrainForge Quiz's free exam preparation library. Each question includes the correct answer and a detailed explanation to help you understand the underlying concept, not just memorize the answer.

How to use this page: Read the question above, consider all four options (A through D), then check the highlighted correct answer and explanation. For active timed practice, start a free CFA Exam Prep practice test or use flashcards for spaced repetition review.

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Strategic asset allocation determines:

✓ Correct Answer: Option B

📚 About This CFA Exam Prep Practice Question

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