Reading 25 EOC 15th Question (Discretionary Bottom-up)

CFA Level III Equities
#1

Question:
Chen prefers an approach that emphasizes security-specific factors, does not engage in factor timing, and builds a diversified portfolio.

Answer: These characteristics all reflect a discretionary bottom-up portfolio management approach

My question is why it is discretionary bottom-up rather than Systematic bottom-up? I will say it is Systematic bottom-up because it does not engage in factor timing and positions are diversified. While discretionary bottom-up has potential factor timing and either diversified or concentrated position.

Can someone help? Tq

#2

Please refer to CFA’s latest errata (Link: https://www.cfainstitute.org/-/media/documents/support/programs/cfa/cfa-level-iii-errata.ashx)

“In the information for questions 9-15, the last paragraph (page 536 of print) should read as follows: “Chen and Garcia then turn their attention to portfolio management approaches. Chen prefers an approach that emphasizes security-specific factors, engages in factor timing, and typically leads to portfolios that are generally more concentrated than those built using a systematic approach.””

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