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⍰ ASK What is the significance of benchmarking for investment companies?

Benchmarking is vital for investment companies. It helps measure performance against standards like market indices.

By comparing returns to benchmarks, firms gauge how well they manage investments. This pinpoints strengths and weaknesses for strategy refinement.

Successful benchmarking sets realistic goals, improves portfolio management and aids client communication. It evaluates manager skill in generating the excess return beyond the benchmark.
 

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