Hi Which approach should we prefer to do performance attribution questions. The one on page 16-17 on Ch 16 or the alternate approach on page 19. The difference between the two seems confusing. Could you please help on how to judge the required approach? Thanks in advance Himanshu
H Himagg, we (ActEd) recommend that you use the approach on pages 16-17, ie with a notional fund based on the actual sector split and benchmark stock selection. The Core Reading (page 22) says this is the usual approach in practice. It is also the approach that the examiners seem to prefer ie this the approach that they use in Examiners Reports. Best wishes Gresham
