CFA CFA Level 1 Question of the Week – Alternative Investments

Question of the Week – Alternative Investments

  • Author
    Posts
    • Avatar of AdaptPrepAdaptPrep
      Participant
        • Undecided
        Up
        3
        ::

        Which of the following hedge fund strategies would most accurately be described as event-driven?

        • Purchasing and restructuring distressed debt/equity
        • Selecting individual securities while remaining market-neutral
        • Speculating market volatility by purchasing and selling options in the
          manufacturing sector
      • Avatar of simply_complex2simply_complex2
        Participant
          • CFA Level 1
          Up
          4
          ::

          @jmsatchwell, third times a charm! 😉

        • Avatar of AdaptPrepAdaptPrep
          Participant
            • Undecided
            Up
            4
            ::

            Event-driven strategies attempt to exploit from short-term
            events. Mergers and acquisitions (M&A) and distressed debt are two other major categories.

            Here are the other categories:

            • Speculating market
              volatility by purchasing and selling options in the manufacturing sector

              Relative value
            • Predicting future
              economic growth from one sector to another
              – Macro
            • Finding individual
              undervalued stocks
              – Equity hedge
            • Selecting individual
              securities while remaining market-neutral
              – Equity hedge
          • Avatar of shannondailyshannondaily
            Participant
              • Undecided
              Up
              2
              ::

              Whoo! I got it right. 🙂 

            • Up
              1
              ::

              Crud just did a practice problem earlier about this and I still got it wrong…

          Viewing 4 reply threads
          • You must be logged in to reply to this topic.