CFA CFA Level 1 Question of the Week – Alternative Investments

Question of the Week – Alternative Investments

  • This topic has 4 replies, 4 voices, and was last updated Jan-18 by AdaptPrep.
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    • AdaptPrep
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      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
    • jmsatchwell
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      Crud just did a practice problem earlier about this and I still got it wrong…

    • simply_complex2
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      @jmsatchwell, third times a charm! 😉

    • shannondaily
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      Whoo! I got it right. 🙂 

    • AdaptPrep
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      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
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