Hedge ratio Samenvattingen, Aantekeningen en Examens

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...

FUTURES FINAL EXAM ACTUAL QUESTIONS AND ANSWERS ALREADY GRADED A+ A trader who is long 5 corn futures contract (5,000 bushels per contract) at $4.20 offsets her position at $4.45. Assuming commission is $50 per contract per round turn, what is her gain or loss on the trade? Ans- Gain of $6,000 Market Orders to sell futures contracts are matched against the best or highest limit order bids Ans- True Hedging margin is set at the same level as a speculator's Ans- maintenance margin...

CAIA QUESTIONS WITH SOLUTIONS 2024 An asset-pricing model that attempts to explain how investors should behave is a(n): normative model. Normative models attempt to explain how investors should behave. Positive models attempt to explain how investors do behave. Theoretical models use assumptions and logic, while empirical models are based on historically observed behavior. Henry Thompson examines a sample of returns for a private equity fund and finds that the sample excess kurtosis ...

1. Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F): Ans- False 2. Stocks and bonds are two types of financial instruments (T/F): Ans- True 3. The matching principle in accrual accounting requires that:: Ans- Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. 4. A basic equation for the balance sheet is:: Ans- Equity = Assets - Liabilities 5. Why is the Balance Sheet known as a permanent statement?: Ans- ...

An asset-pricing model that attempts to explain how investors should behave is a(n): - Answer normative model. Normative models attempt to explain how investors should behave. Positive models attempt to explain how investors do behave. Theoretical models use assumptions and logic, while empirical models are based on historically observed behavior. Henry Thompson examines a sample of returns for a private equity fund and finds that the sample excess kurtosis equals 3. Regarding the private ...

Why do lenders collect reserve funds at the property closing? A) To get a higher yield in their investment B) To be sure money will be available for tax and insurance purposes C) To have extra money that will accrue interest D) To hedge against increases in taxes or insurance premiums - Answer B) To be sure money will be available for tax and insurance payments The cost recovery period for land improvements is how long? A) 15 years B) 25 years C) 27.5 years D) 30 years - Answer ...

An asset-pricing model that attempts to explain how investors should behave is a(n): - Answer normative model. Normative models attempt to explain how investors should behave. Positive models attempt to explain how investors do behave. Theoretical models use assumptions and logic, while empirical models are based on historically observed behavior. Henry Thompson examines a sample of returns for a private equity fund and finds that the sample excess kurtosis equals 3. Regarding the private ...

1. Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F): Ans- False 2. Stocks and bonds are two types of financial instruments (T/F): Ans- True 3. The matching principle in accrual accounting requires that:: Ans- Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. 4. A basic equation for the balance sheet is:: Ans- Equity = Assets - Liabilities 5. Why is the Balance Sheet known as a permanent statement?: Ans- ...

Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F) - False Stocks and bonds are two types of financial instruments (T/F) - True The matching principle in accrual accounting requires that: - Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. A basic equation for the balance sheet is: - Equity = Assets - Liabilities Why is the Balance Sheet known as a permanent statement? - Because the other statements ar...

Texas Real Estate Finance Final Ex Why do lenders collect reserve funds at the property closing? A) To get a higher yield in their investment B) To be sure money will be available for tax and insurance purposes C) To have extra money that will accrue interest D) To hedge against increases in taxes or insurance premiums - ANSWERSB) To be sure money will be available for tax and insurance payments The cost recovery period for land improvements is how long? A) 15 years B) 25 years C) 2...