25 CFA Level 2 Practice Exam 2015 Questions and Answers on Alternative Investments

Be confident to overcome the CFA exam with 25 CFA Level 2 Practice Exam 2015 Questions and Answers on Alternative Investments. Basic concepts of Alternative Investments topic are illustrated specifically and accessibly in this available CFA mock exam free. Those questions in the multiple choice format connect concepts with each other in an explicit way as possible. It means that you can attain the basic knowledge from the curriculum and reinforce skills for exam study. Following are all the core CFA level 1 questions for your practice. Finish as much as you can to know where you’re standing in the learning process and remember to leave your ideas in the comment below!
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for properties that utilize debt & equity financeuses a sinking fund factor to cal cap rate as a WACCRo (BOI)= (mtg weight x mtg cost)+(equity weight x equity cost)

• Estimating Cap Rate - Build up method (BU)
• Estimating Cap Rate - Band of investment method (BOI)
• Estimating Cap Rate - Mkt extration (ME)
• Private Equity Performance Measurement - PIC

r* = [1+r/1-q] -1r= unadj discount rateq=probability of failure*adj terminal value using scenario analysis

• Venture Capital Valuation
• Venture Capital Valuation - accounting risk
• capitalization rate
• Steps in Calculating CFAT

Invest. based on macro int'l trends and their effects on industries and securities

• Hedge strategies: Emerging Mkts
• Hedge strategies: Hedge Equity
• Hedge strategies: Fund of Funds
• Hedge strategies: Global Macro

Ro (ME) = NOI/MV

• Estimating Cap Rate - Build up method (BU)
• Estimating Cap Rate - Mkt extration (ME)
• Estimating Cap Rate - Band of investment method (BOI)
• Venture Capital Valuation

Profit from the diff btwn a current security price and expected price upon completion of a takeover or mergerStrategy: "Event Driven Strategy"

• Hedge strategies: Merger Arbitrage (risk arbitrage)
• Hedge strategies: Emerging Mkts
• Hedge strategies: Fixed Income Arbitrage
• Hedge strategies: Convertible Arbitrage

NOI/r-g = NOI/Ro

• Venture Capital Valuation
• Valuing Real Estate
• capitalization rate
• Market Value (MVo)

MV = gross inceom x gross inc. multipliergross ince multiplier = sales price/gross income

• Recapture of depreciation
• Steps in Calculating CFAT
• Valuing Real Estate
• Gross income Multiplier Technique

useful when comparables not availableRo(BU) = pure rate + liquidity pre + recapture pre + risk pre.

• Estimating Cap Rate - Mkt extration (ME)
• Estimating Cap Rate - Build up method (BU)
• Estimating Cap Rate - Band of investment method (BOI)
• Venture Capital Valuation

a combo of Long and Short positons that kep mkt exposure neutral.strategy: to buy undervalued securities while shorting overvalued securities

• Hedge strategies: Emerging Mkts
• Hedge strategies: Equity Market Neutral
• Hedge strategies: Global Macro
• Hedge strategies: Fund of Funds

Ro = (r-g) required return - E(g on NOI)

• Market Value (MVo)
• capitalization rate
• Steps in Calculating CFAT
• Valuing Real Estate