CAIA Fundamentals Questions and Answers Latest
Updated 2024-2025.
Which of the following structures transforms asset ownership into potentially distinct
and diverse tradable investment opportunities? - ANS trading structure
Which of the following structures refers to the financial markets related to a particular
instrument, such as whether the investment is publicly traded on an exchange? -
ANS
Which of the following investments most likely has a long lock-up period with a fund
life of ten years or longer?
Hedge funds
Managed futures
Private equity
Structured products - ANS private equity
Which of the following statements is most true regarding the role of alternative
investments in reducing portfolio risk? - ANS Portfolio risk declines most quickly
when investors allocate to return diversifiers and correlations across assets are low
Which of the following investments is most likely to employ short selling as a key part
of the investment strategy?
Commodities
Mutual funds
Hedge funds
Private equity - ANS Hedge funds
Which of the following best allows entities to transfer credit risk?
Collateralized debt obligations
Credit default swaps
Mezzanine debt funds
Fixed income arbitrage funds - ANS credit default swaps
Which of the following facilitates increasing leverage in an investment fund?
I. Borrowed funds
II. Trading options and futures
III. Investing in mortgage-backed securities
IV. Investing the proceeds from short sales - ANS I, II, IV
Which two of the following most correctly describe registered funds?
I. Registered funds have greater liquidity than private placements
II. Private placements have greater liquidity than registered funds
III. Registered funds are only available to accredited investors
IV. Registered funds are available to both retail and accredited investors - ANS I and
IV
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