Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

AAFM GLO_CWM_LVL_1 Exam - Topic 8 Question 116 Discussion

If an investor's excess return is negative,
B) the required return exceeded the realized return
A) the realized return was less than the return earned by the market
C) the investor constructed a poorly diversified portfolio
D) the investor's portfolio had excessive diversification

AAFM GLO_CWM_LVL_1 Exam - Topic 8 Question 116 Discussion

Actual exam question for AAFM's GLO_CWM_LVL_1 exam
Question #: 116
Topic #: 8
[All GLO_CWM_LVL_1 Questions]

If an investor's excess return is negative,

Show Suggested Answer Hide Answer
Suggested Answer: B

by Anjelica at Apr 12, 2026, 09:03 PM

Limited Time Offer

25%

Off

Get Premium GLO_CWM_LVL_1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Christa
1 month ago
B is my pick. Realized vs required is crucial.
upvoted 0 times
...
Suzan
1 month ago
A feels right. Less than market is a loss.
upvoted 0 times
...
Lawana
1 month ago
D seems unlikely. Excessive diversification?
upvoted 0 times
...
Thad
2 months ago
C could be true. Poor diversification hurts.
upvoted 0 times
...
Joanna
2 months ago
B makes sense too. Required return is key.
upvoted 0 times
...
Leota
2 months ago
I think A is correct. Market returns matter.
upvoted 0 times
...
Stevie
2 months ago
Not sure about D), that seems off to me.
upvoted 0 times
...
Dorethea
2 months ago
Wait, how can excessive diversification lead to negative returns?
upvoted 0 times
...
Chana
3 months ago
C) could be a factor, but not always.
upvoted 0 times
...
Thaddeus
4 months ago
I think B) makes sense too.
upvoted 0 times
...
Adela
4 months ago
A) is definitely true.
upvoted 0 times
...
Tricia
5 months ago
D seems off to me; I thought excessive diversification usually reduces risk. I lean towards A or B, but I'm not completely sure.
upvoted 0 times
...
Sena
5 months ago
I recall discussing diversification, but I can't remember if excessive diversification leads to negative excess returns. C seems plausible, but I'm not confident.
upvoted 0 times
...
Lindsey
5 months ago
I'm not entirely sure, but I remember something about required returns. Maybe B is the answer since it sounds familiar from practice questions.
upvoted 0 times
...
Taryn
5 months ago
I think if the excess return is negative, it might mean the realized return was less than the market return, so A could be right.
upvoted 0 times
...

Save Cancel