Canadian Securities Course (CSC) Level 2 Practice Exam

The correct choice is indeed a growth manager. A growth manager primarily seeks investments in companies expected to grow at an above-average rate compared to others in the market. Their strategy focuses on identifying stocks that are poised for significant expansion, typically favoring companies with innovative products or services that can achieve rapid revenue and earnings growth.

This type of manager tends to thrive in a rising market, where investors are optimistic about economic prospects, leading to increased capital inflow into growth-oriented stocks. This strategy aligns with the philosophy of pursuing long-term capital appreciation, rather than immediate income generation or market corrections.

Value managers, in contrast, focus on undervalued stocks with strong fundamentals, often pursuing a more defensive strategy. Passive managers aim to replicate market indices rather than actively choose securities based on potential growth. Active managers can include different styles, including both growth and value strategies, but the specific focus on above-average potential long-term growth distinctly aligns with the approach of growth managers.