CFA Practice Question
The ______ investment strategy means investors want the portfolio to concentrate on generating income rather than capital gains.
A. capital preservation
B. capital appreciation
C. current income
Explanation: This is a relatively low-risk strategy chosen by investors who want to supplement their earnings with income generated by their portfolio to meet living expenses.
User Contributed Comments 6
| User | Comment |
|---|---|
| lwang014 | capital preservation is for the "against-inflation" purpose? |
| Rguerra | why not B? |
| danlan | It is for income generation rather than capital preservation. |
| dimanyc | capital preservation is investment in TIPS. |
| dlukas | capital preservation could include money markets. Current income specifically means you want securities that you don't have to liquidate in order to convert some of your returns into cash. |
| GBolt93 | capital appreciation would be capital gains. E.g. high growth rather than high dividends or fixed income |