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Buy the undervalued securities of firms in financial distress when
analysis indicates value will be increasing after a restructuring. (Or
short overvalued). A type of *Event*-*Driven* *Strategy*.
Employ predominantly short positions in overvalued equities with
negative market exposure overall. A type of *Equity* *Hedge* *Strategy*.
The interest earned on collateral required to enter into a futures contract.
The incentive fee is not paid on gains that offset prior losses.
Shares that trade publicly like shares of a stock, where 90% of income must be distributed to shareholders to avoid tax.
A fee that is earned regardless of investment performance.
Investments made during a firm's earliest period.1) *Angel*
*investing* (idea stage)2) *Seed* *stage* (product development,
marketing)3) *Early* *stage* (fund production & sales)
1) Organization2) Portfolio management3) Operations and controls4) Risk management5) Legal Review6) Fund terms
Bias introduced by including previous performance data for firms recently added to a benchmark index.
An estimate of the size of potential decline over a period that will occur.
An LBO in which an external management team will replace the existing management team.
Select undervalued securities to long while selecting overvalued
securities to sell short, in relatively equal amounts. Profits will come
from relative price movements without exposure to market risk. A type
of *Equity* *Hedge* *Strategy*.
When futures prices are less than spot prices as a result of a high convenience yield.
A hedge fund strategy based on global economic trends using long or
shorts in equity, currencies, fixed income, or commodities.
A benchmark rate, above which incentive fees are earned, and below which fees are not.
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