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- Market timers focus onusing overall market trends as a basis for predicting when to buy or sell investments. However, they can use valuation techniques on specific financial instruments to support their decision. True or false?Which of the following decision criteria is the easiest to use and very popular among investors? O Payback period. O Internal rate of return. O Average accounting return. Net present value. O Discounted return on investment.1. What are the quantitative characteristics of the assets and how to measure them? 2. How does one asset in the same portfolio influence the other one in the same portfolio? 3.And what could be the influence of this relationship to the investor’s portfolio? 4. What is relationship between the returns on an asset and returns in the whole market (market portfolio)
- 1.What is the relationship between an investment’s risk and its return? Please provide examples if possible. 2. Difference between Institutional Investors and Individual Investors.When screening for potential equity investments based on return on equity, to controlrisk, an analyst would be most likely to include a criterion that requires:A . positive net income.B . negative net income.C . negative shareholders’ equity.Elaborate the following statements: A. Portfolio return is a linear combination of individual securities whereas portfolio risk is nonlinear.B. Portfolio Management is primarily a risk diversification tool.C. Financial Contracts are those which give simultaneous rise to the financial assets of one entity and financial liability or equity of another entity.D. Investment decision refers to the selection and acquiring the resources whereas financing decision refers to the arrangement of funds to acquire selected resources.
- CAN SOMEONE HELP ME ANSWER THESE 2 QUESTIONS? (Net income ∕ Total assets) A. Operating profit margin B. Net profit margin C. Operating return on assets D. Return on total assets E. Return on equity Which of the following statements is most correct? A. Combining positively correlated assets having the same expected return results in a portfolio with the same level of expected return and a lower level of risk. B. Combining negatively correlated assets having the same expected return results in a portfolio with the same level of expected return and a lower level of risk. C. Combining positively correlated assets having the same expected return results in a portfolio with a lower level of expected return and a lower level of risk. D. Combining negatively correlated assets having the same expected return results in a portfolio with a lower level of expected return and a lower level of risk.You are interested in investing in an equity fund. Which step of the investment management process will require you to understand the investment management style? A) Defining the investment objectives and constraints. B) Setting the investment strategy. C) Implementing and managing the portfolio. D) Monitoring and reviewing.The profitability index is another method to evaluate capital investments. If you are trying to compare investments of different sizes, why is the profitability index a better way to do this when compared to the net present value method?
- 1. Which of the following models for mathematics of the financial markets is dependent on expectations or probabilities of changes in the value of an underlying asset? A. Monte Carlo Simulation B. Black Scholes Model C. Cox-Ross-Rubinstein Model 2. Models for the financial markets are primarily used for all of the following, except, A. Algorithmic Trading B. Technical Analysis (Short term trading) C. Fundamental Analysis (Long term investing D. All of the above 3. Which among the following organizations use financial mathematics as part of their core operation? A. Investment banks B. Government C. Hedge funds D. All of the above 4. S1: Quantitative finance helps to allocate resources to provide the optimum returns. S2: Financial models are accurate. A. Both statements are true B. Both statements are false C.…2. How would you describe the correlation between risk and return in investments, and what are the various types of income that investors consider from their standpoint?A member of a firm’s investment committee is very interested in learning about the management of fixed-income portfolios. He would like to know how fixed-income managers position portfolios to capitalize on their expectations concerning three factors which influence interest rates:a. Changes in the level of interest rates.b. Changes in yield spreads across/between sectors.c. Changes in yield spreads as to a particular instrument.Formulate and describe a fixed-income portfolio management strategy for each of these factors that could be used to exploit a portfolio manager’s expectations about that factor. (Note: Three strategies are required, one for each of the listed factors.)