benchmark aware and benchmark agnostic

CFA Level III
#1

Can anyone help me in definition and the difference between Benchmark aware and benchmark agnostic

Thank you

#2

Benchmark aware means that you have a benchmark (e.g., the S&P 500) against which your performance will be judged.

Benchmark agnostic means that you don’t.

If you’re benchmark aware, your risk measurement will be a relative risk measure (such as tracking error). If you’re benchmark agnostic, it will be an absolute risk measure (such as standard deviation of returns).

3 Likes
#3

Thank you very much

Happy new year !

#4

My pleasure.

Happy New Year back atcha.