The equity mutual fund's risk audit committee is currently evaluating a portfolio construction strategy recommended by a newly appointed portfolio manager entrusted with capital management. Although the fund grants its managers the autonomy to select and employ appropriate portfolio construction techniques, it is imperative that the chosen method aligns with the key risk management objectives set by the company. Which of the following portfolio construction methods accurately reflects its ability to manage risk in the context of portfolio construction? | Financial Risk Manager Part 2 Quiz