Exam (elaborations)
AWMA TEST QUESTIONS AND ANSWERS
- Course
- Institution
AWMA TEST QUESTIONS AND ANSWERS...
[Show more]
Content preview
AWMA TEST QUESTIONS AND ANSWERSCapital Market Line - ANSWER. A graphical representation of the relationship
between risk and return, where risk is measured by standard deviation; the CML
incorporates the concept of a risk-free rate of return.
Jenson Performance Index - ANSWER utilized to compare the performance of
money managers on a risk-adjusted basis and can be utilized independently. A
score over 0.00 implies that the management performed better than predicted
considering the risk he took... vice versa.
How do Treynor and Sharpe's indexes work best? - ANSWER Both are used to
compare risk-adjusted returns across different funds. The greater the risk-adjusted
return, the better. The main difference is that Treynor employs Beta as a risk
metric, hence it can only be utilized with fully diversified portfolios. Sharpe
employs standard deviation (total risk) as a measure of risk and can only be used
with fully diversified or nondiversified portfolios.
Benefits of Buy and Hold: ANSWER returns at least as good as techniques based
on technical analysis, minimal transactional costs, the deferral of capital gains taxes
on profits, and not missing the finest days of the market.
Property value - ANSWER NOI/Cap Rate
Typical hedge fund fees include an annual management charge of roughly 2%, as
well as an incentive (performance) fee of 10 to 20% of the fund's profits. The
expression "2 and 20" refers to the hedge fund manager receiving a 2%
management fee and 20% of the earnings. To earn a performance fee, the fund
management may need to exceed a certain threshold. There may also be a surrender
fee when the fund is sold.
Major risks in hedge funds include illiquidity, management risk, investment
strategy risk, headline/regulatory risk, and the potential of negative tax
repercussions.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller luzlinkuz. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
73243 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now