Question: 1 . As a portfolio manager would you rather be evaluated using a normal portfolio or a market index? 2 . Why is a customized

1 .

As a portfolio manager would you rather be evaluated using a normal portfolio or a market index?

2 .

Why is a customized liability index a more effective benchmark for a defined benefit pension plan?

3 .

Assume you are a bond portfolio manager of an investment grade corporate bond portfolio. How willing are you to accept bonds falling into one of the five different tolerant portfolios?

4 .

Why is the duration

-

times

-

spread

(

DTS

)

approach superior to the spread duration approach in estimating exposure to changes in corporate credit spreads?

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