Sharpe ratio Guides d'étude, Notes de cours & Résumés

Addition Rule of Probability correct answer: ADDITION: P(A or B) = P(A) + P(B) - P(AB) Roy's Safety First Criterion correct answer: Safety First Ratio = (E(R) - Rₜ) / σ Larger ratio is better If (Rₜ) is risk free rate, then it becomes Sharpe Ratio Sharpe Ratio correct answer: Sharpe Ratio = (E(R) - RFR) / σ Larger ratio is better If (Rt) is higher than RFR, then it becomes Safety First Ratio Central Limit Theorem correct answer: If we take samples of a population,...

Why did it become a good investment to bet against mortgage-backed securities. A) The default rate on the mortgages kept rising. B) Rating agencies were accurately assigning ratings. C) Banks were incentivized to issue more and more mortgages. D) A and C - Answer D) A and C In terms of the fundamental law, when aiming for high performance, you can make up for low skill with ___. A) low breadth B) low sharpe ratio C) high breadth D) high volatility - Answer C) high bread...

Which of the following is a key element that all investment policy statements should contain? - cORRECT sOLUTION An investment policy statement should include statements regarding acceptable investment vehicles, the portfolio's asset allocation, and the client's risk tolerance level. The asset management process can be used to adjust to changes in a client's financial situation by - cORRECT sOLUTION helping the client to ignore market "noise." The asset management process is designed to...

CFA Level 1 - 101 Must Knows question and answers 2023 verifiedAddition Rule of Probability - correct answer ADDITION: P(A or B) = P(A) + P(B) - P(AB) Roy's Safety First Criterion - correct answer Safety First Ratio = (E(R) - Rₜ) / σ Larger ratio is better If (Rₜ) is risk free rate, then it becomes Sharpe Ratio Sharpe Ratio - correct answer Sharpe Ratio = (E(R) - RFR) / σ Larger ratio is better If (Rt) is higher than RFR, then it becomes Safety First Ratio Central Lim...

The Asset Management Process is... Ans: Gather data, Establish goals, Analyze information, Make recommendations and implement, monitor performance Required Rate of return formula = Ans: (e)r = Rf + (Rm-Rf)Bp What is Excess Return ? Ans: Total Portfolio Return - Risk Free Rate Explain Jensen performance ratio? Ans: This measure of performance is a measure of absolute risk, meaning it can be used as a stand-alone measure as apposed to a relative measure (one that compares) Treynor rati...

AAMS Module 1-10 Quizzes - Questions and Answers (Complete Solutions) What are the major steps in the asset management process? 1. gather data 2. establish goals 3. analyze information 4. make and implement recommendations 5. monitor Stefan's business plan includes the following goal: "I will contact 50 prospective clients and document this activity in the CRM for tracking purposes." Which primary element of a good goal is missing? This goal is not time-framed. The acronym to remember for g...

What does the capital market line (CML) indicate? correct answers that the market portfolio maximizes the Sharpe ratio What is the CML invested in correct answers the risk-free asset and the market portfolio Where do individual stocks plot in relation to the CML correct answers Underneath (not on) the CML When you own a single stock, what kind of risk are you exposed to? correct answers Firm specific risk Systematic risk What is the risk of an asset held in isolation measured by cor...

CFA Level 1 - 101 Must Knows question with 100% correct answers 2023Addition Rule of Probability - correct answer ADDITION: P(A or B) = P(A) + P(B) - P(AB) Roy's Safety First Criterion - correct answer Safety First Ratio = (E(R) - Rₜ) / σ Larger ratio is better If (Rₜ) is risk free rate, then it becomes Sharpe Ratio Sharpe Ratio - correct answer Sharpe Ratio = (E(R) - RFR) / σ Larger ratio is better If (Rt) is higher than RFR, then it becomes Safety First Ratio Centra...

Alpha - ️️Measure of risk-adjusted performance Beta - ️️Measure of a fund's or a stock's risk in relation to the market or to an alternative benchmark Gamma - ️️Ratio of a change in the option delta to a small change in the price of the asset on which the option is written PERS - ️️Public Employee Retirement System CAFR - ️️Comprehensive Annual Financial Report PERS CAFR - ️️Comprehensive Annual Financial Report for a Public Employee Retirement System ...

In dit document wordt alle leerstof voor het examen samengevat. Het bevat ook alle notities genomen in de lessen van financieel management gegeven door Prof. Dr. Stefan Straetmans. Bovendien worden alle extra elementen vanuit het boek ook besproken in het document.