Q 6. How investment in secularized assets bring more flexibility in financial institution’s investment portfolio?

Q 6.
How investment in secularized assets bring more flexibility in financial institution’s investment
portfolio?

Solutions

Expert Solution

Secularized assets are those assets which will always be giving a constant rate of return and they are not affected by the fluctuation in the short term trend or the fluctuation in the medium term trend, because they are always meant for investment in the long term and they are always known for getting affected by the short-term fluctuations in market events and they will always be consistent in providing with the Asset returns.

Investment in secularized asset will bring more flexibility to the overall portfolio because this is like a diversification technique and this will also be acting as a fixed income type of asset which will not get affected by the short term Trend, and this will also be providing as a hedge against uncertainty.

investment in secularized asset will be unaffected by the market short term fluctuations and it will always be having a continuous trend and consistent rate of return so it will always be highly diversified kind of asset class and it will help the portfolio in management of risk. it will offer high rate of flexibility to the portfolio as it will be hedged against short-term uncertainty.

jeff jeffy answered 1 year ago

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