Sign up  |  Log in

Rebalancing strategy

In schweser concept checkers we have question 3 p 48 vol 5 which states 

You expect the stock market to be relatively volatile over the next year. You also expect that the annual holding period return will be roughly zero. Recommend and justify a portfolio investment strategy given your forecast .

Of course we think of CM (constant mix) BUT because of 0% return I thought BH might be better given cost and tax efficiency as owing to transaction costs we would be negative with CM for sure .

Why would this be wrong in this case? 

Review the key concepts and receive exam tips just before you take the exam!

^ I think this belongs to CFA L3 not CAIA L1.

The harder the struggle, the more glorious the triumph.