Tactical asset allocation - Study guides, Class notes & Summaries

Collar strategy consists of... - ANSWER-ownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - ANSWER-within a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - ANSWER-relies on derivatives contracts to create hedges growth bucket - ANSWER-invests the surplus in riskier investments to ...

Diversification - ANSWER-Acquiring assets with low or negative correlations to each other with the goal of lowering overall risk Correlation - ANSWER-- a relative measure of the degree to which the returns of two assets move together - range from +1.0 to -1.0 - in practice negative correlations are rare - the further a correlation is from +1.0, the more diversified Asset allocation - ANSWER-- the apportioning of available funds among a number of asset classes in a way that meets the ne...

CAIA Level II Exam I Questions and Answers 100% Verified Collar strategy consists of... - answerownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - answerwithin a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - answerrelies on derivatives contracts to create hedges growth bucket - a...

Collar strategy consists of... - ANSWER-ownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - ANSWER-within a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - ANSWER-relies on derivatives contracts to create hedges growth bucket - ANSWER-invests the surplus in riskier investments to ...

CAIA Level II Exam I Questions and Answers 100% Verified Collar strategy consists of... - answerownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - answerwithin a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - answerrelies on derivatives contracts to create hedges growth bucket - a...

PFQF Practice Exam 2 - Complete Solutions (Answered) Which one of the following statements concerning investing strategies is CORRECT? A) Strategic asset allocation moves assets according to changing market conditions. B) Tactical asset allocation uses risk and return as the basis for asset allocation and rarely changes that allocation. C) A pure buy-and-hold strategy minimizes transaction costs and can help with tax efficiency. D) Dollar cost averaging causes more stock shares to be obtained ...

CAIA Level II Exam I Questions and Answers 100% Verified Collar strategy consists of... - answerownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - answerwithin a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - answerrelies on derivatives contracts to create hedges growth bucket - a...

Chapter 23 Exam Questions With Verified Answers A client holds a passively managed ETF wrap account. Due to market declines, the account has diverged from the set asset allocation. The manager anticipates market increases in the oil and gas sector in the next three months. What action will be taken in the wrap account? A. None. B. Rebalancing to the original asset allocation. C. Actively overweighting in the oil and gas sector. D. Increasing cash to take advantage of upcoming investment ...

Collar strategy consists of... ownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket within a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach relies on derivatives contracts to create hedges growth bucket invests the surplus in riskier investments to generate greater return Duration ...

Collar strategy consists of... - Answer ownership of a risky asset with a long position in a put option on the underlying asset, and a short position in the call option on the underlying asset Hedging Bucket - Answer within a plan's asset-liability framework seeks to track the plan's liabilities and minimize the volatility of the plan surplus Overlay approach - Answer relies on derivatives contracts to create hedges growth bucket - Answer invests the surplus in riskier investments to ...