CIMA wiley test bank Q&A

Investment talent analysis can be an important form of __________ criteria. - Answer- qualitative According to most reports, an increase in child labor in developing countries can be indirectly linked to the: - Answer- World trade organization An investor reviews a model and determines that the factors used are oversimplified in regard to this investor's risk. This investor most likely is using which modeling strategy to evaluate risk? - Answer- Value at risk An investor working with alternative investments chooses to limit or avoid layering fees. Based on these criteria, this investor potentially wants to include: - Answer- Private equity Covariance is best described as the: - Answer- deviation from the mean of two variables Variance is defined as the: - Answer- Expected value of the difference between the variable and the mean squared A consultant discussing risk management techniques to specific equities in a client portfolio should discuss: - Answer- Using futures An investor not interested in compounding may elect to calculate the: - Answer- mean return The tenet of buying low and selling high is reflected in the asset allocation strategy of: - Answer- constant mix A consultant is reviewing the effect of GDP reports on the stock market. After review, she would conclude that, as an indicator, GDP is: - Answer- strong A Japanese manufacturing company has delivery of products to the United States within the next week. To hedge its currency risk, the company may choose to review the: - Answer- spot rate If the yield spread on a corporate bond widens relative to a stable 10-year Treasury bond, a consultant may conclude that: - Answer- the bond is underperforming treasuries during that period The capital asset pricing model is considered to be a form of the: - Answer- APT A limitation of the Treynor ratio is that the ratio: - Answer- ranks funds with similiar systematic risk the same Variance