i know the definitions of the different levels from a text book perspective. However what are these 3 different levels measuring in layman’s terms? The descriptions in the text seem complex and I’m trying to wrap my head around it by putting it into a simple langauge.
I am guessing you mean #3 Asset Category, #4 Benchmarks, and #5 Investment managers.
Asset Category-This is a “pure index fund” approach. Think of it as investing in the vanguard s&p 500 INDEX FUND. Hands off. Goes up and down with the market. Usually the largest source of incremental return.
Benchmarks- “Misfit” or “style” return is key term here. This is the proportion of return related to your benchmark. versus the asset category benchmark.
Investment managers- Return attributable to active management.
I am guessing you mean #3 Asset Category, #4 Benchmarks, and #5 Investment managers.
Asset Category-This is a “pure index fund” approach. Think of it as investing in the vanguard s&p 500 INDEX FUND. Hands off. Goes up and down with the market. Usually the largest source of incremental return.
Benchmarks- “Misfit” or “style” return is key term here. This is the proportion of return related to your benchmark. versus the asset category benchmark.
Investment managers- Return attributable to active management.
I am guessing you mean #3 Asset Category, #4 Benchmarks, and #5 Investment managers.
Asset Category-This is a “pure index fund” approach. Think of it as investing in the vanguard s&p 500 INDEX FUND. Hands off. Goes up and down with the market. Usually the largest source of incremental return.
Benchmarks- “Misfit” or “style” return is key term here. This is the proportion of return related to your benchmark. versus the asset category benchmark.
Investment managers- Return attributable to active management.