Caia level ii - Study guides, Class notes & Summaries

CAIA Level II Exam Questions and Answers

CAIA Level II Exam Questions and Answers 100% Solved What advantage do multi-factor models have over single-factor models, such as the Capital Asset Pricing Model? - ANSWER-Multi-factor models tend to explain systematic returns much better than do single-factor models. By doing so, multi-factor models are generally believed to produce better estimates of idiosyncratic returns. List the three major categories of factors that drive asset returns. - ANSWER-Macroeconomic factors, fundamental/sty...

CAIA Level II Exam Questions & Answers 100% 5th percentile vs 25th percentile performance - ANSWER-5th percentile managers outperform in every comparison BUT 25th percentile managers' performance is more volatile --> even if 25th percentile managers outperform they tend to mean revert --> demonstrates the perils of choosing managers based on historical performance alternative asset performance evaluation - ANSWER-unlike in traditional assets, alpha is difficult to define in alternativ...

5th percentile vs 25th percentile performance - ANSWER-5th percentile managers outperform in every comparison BUT 25th percentile managers' performance is more volatile --> even if 25th percentile managers outperform they tend to mean revert --> demonstrates the perils of choosing managers based on historical performance alternative asset performance evaluation - ANSWER-unlike in traditional assets, alpha is difficult to define in alternatives investing; success can be defined as posit...

What advantage do multi-factor models have over single-factor models, such as the Capital Asset Pricing Model? - ANSWER-Multi-factor models tend to explain systematic returns much better than do single-factor models. By doing so, multi-factor models are generally believed to produce better estimates of idiosyncratic returns. List the three major categories of factors that drive asset returns. - ANSWER-Macroeconomic factors, fundamental/style/investment/dynamic factors, and statistical factors...

CAIA Level II Sample Exam 2024 Questions and Answers (Graded A) CAIA Level II Sample Exam 2024 Questions and Answers (Graded A) CAIA Level II Sample Exam 2024 Questions and Answers (Graded A)Intuition of the Black-Derman-Toy interest rate model - ANSWER-Observed spot rates drive rate levels while implied rate volatilities drive rate spreads Understanding the intuition of imposing these two conditions helps in understanding the essence of the BDT model. The spot rates in the currently ob...

CAIA Level II Exam I Questions and Answers 100% CorrectCAIA Level II Exam I Questions and Answers 100% CorrectCAIA Level II Exam I Questions and Answers 100% CorrectCollar 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 th...

CAIA LEVEL II EXAM WITH QUESTIONS AND ANSWERS...

CAIA Level II Topic 2: Models Complete Questions and Answers 100% Correct | Updated 2024

CAIA Level II Exam Questions With 100% Correct Answers.