Overview of Equity Portfolio Management
Free CFA Level III: Portfolio Management lesson in Portfolio Construction. 30 min read, ~4,461 words.
Passive = replicate the benchmark at minimum tracking error and cost; active = generate alpha above the benchmark. Fundamental active: high IC per decision, low breadth, concentrated. Quantitative: low IC, high breadth, diversified. The Fundamental Law of Active Management: IR = IC x sqrt(BR) x TC, both fundamental and quant...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- equity pm overview
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