Identify which investment vehicle best addresses each characteristic highlighted in Parade’s IPS by placing a check mark where appropriate. Justify your response.

Lute is particularly concerned about portfolio construction and the prospective implementation of investments within the portfolio. All else equal, Lute has identified these distinguishing characteristics for the processes affecting portfolio construction by the three managers.

• Manager A uses hard-stop losses to manage risk.
• Manager B’s portfolio can be liquidated within five business days or less.
• Manager C’s portfolio turnover is greater than the frequency of signals generated.

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Identify which investment vehicle best addresses each characteristic highlighted in Parade's IPS by placing an x where appropriate. Characteristic Transparency Investor Behavior Cost Liquidity Tracking Risk SMA Justify your response. Diversified Justification