WorksheetsGroup 2 - PORTFOLIO THEORY, ASSET CLASSES & INVESTMENT VEHICLE
Total questions: 10
Worksheet time: 3mins
What fundamental concept does a Fixed Income security primarily represent for the investor?
A debt instrument, making the investor a lender to the issuer.
A guaranteed return that is not subject to inflation risk.
Residual ownership, making the investor a shareholder.
A mandate to distribute a percentage of income as dividends.
According to the report, what is the typical range for the minimum initial deposit required to open an online stock brokerage account in the Philippines?
₱500,000 or higher
₱50,000 to ₱100,000
As low as ₱1,000 to ₱5,000
₱10,000 to ₱20,000
Which specific government security product is designed for retail investors and features the lowest minimum investment of ₱5,000?
Retail Treasury Bonds (RTBs)
Foreign Currency Bonds (FCBs)
FXTNs / T-Bonds
Treasury Bills (T-Bills)
What law requires Philippine REITs to pay out at least 90% of their income as dividends?
Republic Act No. 7721 – Foreign Banks Liberalization Law
Republic Act No. 10963 – TRAIN Law
Republic Act No. 9856 – The Philippine REIT Law
Republic Act No. 8799 – Securities Regulation Code
Which asset class is considered the most illiquid and has the highest entry cost?
Commodities
Real Estate
REITs
Government Bonds
What percentage of income are Philippine REITs legally required to distribute to shareholders?
50%
70%
90%
100%
What is the primary benefit of including Real Estate, REITs, and Commodities in an investment portfolio?
To maximize short-term trading profits
To increase portfolio volatility
To achieve diversification and inflation protection
To rely solely on local equity market performance
Who is credited with developing the Modern Portfolio Theory (MPT)?
Eugene Fama
Harry Markowitz
William Sharpe
Robert Merton
What is the primary goal of a rational investor according to MPT?
Maximizing returns regardless of risk.
Minimizing risk regardless of returns.
Maximizing portfolio returns for a given level of risk, or minimizing risk for a given level of expected return.
Achieving market average returns with minimal transaction costs.
In MPT, what does the term 'Efficient Frontier' represent?
A set of optimal portfolios that offer the highest expected return for a defined level of risk or the lowest risk for a given expected return.
The line connecting the risk-free asset to the tangency portfolio.
A theoretical boundary for all possible investment portfolios.
The average return of all assets in the market.
