5 Questions
What do investors typically choose as a portfolio benchmark?
Investors typically choose a market index, or combination of indexes, to serve as the portfolio benchmark.
What does an index track the performance of?
An index tracks the performance of a broad asset class, such as all listed stocks, or a narrower slice of the market, such as technology company stocks.
Do indexes represent a 'passive' or 'active' investment approach?
Indexes represent a 'passive' investment approach.
What can using an index help to determine in relation to an actively managed portfolio?
Using an index, it is possible to see how much value an active manager adds and from where, or through what investments, that value comes.
What have numerous other equity indexes been designed to track?
Numerous other equity indexes have been designed to track the performance of various market sectors.
Test your knowledge of benchmarks with this quiz from PIMCO. Learn about the significance of benchmarks in investment and how they track the performance of different asset classes.
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