CFA CFA Level 3 Question of the Week: Level 3 – Portfolio Management

Question of the Week: Level 3 – Portfolio Management

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    • MarkMeldrum
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      Successful timing of a portfolio’s exposure to rewarded factors would be a source of:

      • A. alpha.
      • B. alternative beta.
      • C. idiosyncratic risk.
    • MarkMeldrum
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      The correct answer is Option A. 

      With exposures to rewarded factors increasingly accessible via rule-based indexes, simple static exposure to known rewarded factors is no longer widely considered a source of alpha.  However, successfully timing that exposure would be a source of alpha.

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