Pool vs. portfolio

English as a Second Language English Teacher Explanations (ESL Tests)
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Business English Lesson, Advanced Level

ESL/EFL Test #179 [color=blue]“Entrepreneurship”, question 8

In contrast to an entrepreneur, a venture capitalist is a professional money manager who makes risk investments from a … of capital to obtain a high rate of return.

(a) pool
(b) portfolio
(c) stock
(d) stream

Business English Lesson, Advanced Level

ESL/EFL Test #179 [color=blue]“Entrepreneurship”, answer 8

In contrast to an entrepreneur, a venture capitalist is a professional money manager who makes risk investments from a pool of capital to obtain a high rate of return.

Correct answer: (a) pool

Your answer was: [color=red]incorrect
In contrast to an entrepreneur, a venture capitalist is a professional money manager who makes risk investments from a portfolio of capital to obtain a high rate of return.
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Hi,
I wonder this word,“portfolio”, is uncountable or not. May I say"…who makes risk investments from capital portfolio to obtain a high rate of return"?
My Miss Dictonary says, "pool: n (Countable) ,common fund of money. " I think it should be right if portfolio could be used. Because it has the meaning :set of investments owned by someone. But She didn’t say it countable or not, "a portfolio " sounds odd, indeed.

Thanks

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Portfolio is certainly countable, FF-- and many investors have a portfolio of stocks. So you need an article (at least) in this sentence:

However, that is not a correct answer to the question, since we are not speaking of a stockbroker or an investment house, but a venture capitalist, who pools money to advance his ideas and make more money.

I don’t think the fact that it is a set of investments would tend to make it uncountable, any more than is a group of anything.

Have I responded to your question adequately?
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Hi,MM
Thanks! Since “Portfolio” is countable I just wonder why I can’t use it instead of “pool” here.
"Venture " has meanings like: project or undertaking esp a commercial one where there is a risk of failure(Oxford Advanced English-Chinese Dictionary,1997), if you say “venture capital”, that is , money invested in a new enterprise,esp a risky one. I think , as a venture capitalist , he probably invests capitals to many projects (risky projects) to earn money. That is to say, a venture capitalist would put money to risky projects, no matter where he is , stock exchange or not. I think, maybe “portfolio” has been fixed with a concept that only people doing businesses in stock exchanges could be called as “investors of capital portfolio”, __stockbroker.
From this point, “portfolio” is just within the limit of stock exchange businesses, you meant that. I just thought it from other aspect. Hope you won’t be confused after these tedious words. :stuck_out_tongue:
F.F

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I think I understand the points you are making, FF – but I cannot agree that stockbrokers would normally be considered venture capitalists:

Venture Capital: Source of equity financing (250K and above) for small businesses with major growth potential and experienced senior management. Definition: [crh] An investment in a start-up business that is perceived to have excellent growth prospects but does not have access to capital markets. Type of financing sought by early-stage companies seeking to grow rapidly.

As for portfolio, I think that native speakers expect the word to apply to stockholders and graphic artists only. This is the full definition from the American Heritage Dictionary:

1a. A portable case for holding material, such as loose papers, photographs, or drawings. b. The materials collected in such a case, especially when representative of a person’s work: a photographer’s portfolio; an artist’s portfolio of drawings. 2. The office or post of a cabinet member or minister of state. 3. A group of investments held by an investor, investment company, or financial institution.

And this from the Compact Oxford on-line:

1 a thin, flat case for carrying drawings, maps, etc. 2 a set of pieces of creative work intended to demonstrate a person’s ability. 3 a range of investments held. 4 the position and duties of a Minister or Secretary of State.

If I have done a good job of writing advanced questions, you should find more of these ‘very close to correct’ answers in future tests. In addition to grammatical and semantic possibility, test takers should also consider collocation and expected usage.

Once again, I should admit, however, that I am not an economist, accountant or financial manager; I am an English teacher and test writer only!
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Hi, MM
Thank you very much!
Because business English is more professional ,sometimes, I have to ask you not only for those basic knowledges but some economic or accounting knowledges, which is inevitable. :lol: But they are good study materials, indeed. Thanks again! I will do those exercises all gradually.

F.F