Tactical asset allocation differs from strategic by:

A Never changing weights

B Temporarily deviating from long-term targets based on short-term market opportunities

C Using only bonds

D Ignoring market conditions

✓ Correct Answer: Option B

Tactical allocation makes short-term adjustments to exploit market opportunities, then reverts to strategic targets.

💡 Why is B) the correct answer?

The correct answer to the question "Tactical asset allocation differs from strategic by:" is Option B: Temporarily deviating from long-term targets based on short-term market opportunities.

The other options — A) Never changing weights, C) Using only bonds, D) Ignoring market conditions — are incorrect for this CFA Exam Prep question. As explained above: Tactical allocation makes short-term adjustments to exploit market opportunities, then reverts to strategic targets.

📚 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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Tactical asset allocation differs from strategic by:

✓ Correct Answer: Option B

📚 About This CFA Exam Prep Practice Question

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