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NEW QUESTION: 1
A. Option C
B. Option B
C. Option A
D. Option D
Answer: B,C
NEW QUESTION: 2
Dan Draper, CFA is a portfolio manager at Madison Securities. Draper is analyzing several portfolios which have just been assigned to him. In each case, there is a clear statement of portfolio objectives and constraints, as welt as an initial strategic asset allocation. However, Draper has found that all of the portfolios have experienced changes in asset values. As a result, the current allocations have drifted away from the initial allocation. Draper is considering various rebalancing strategies that would keep the portfolios in line with their proposed asset allocation targets.
Draper spoke to Peter Sterling, a colleague at Madison, about calendar rebalancing. During their conversation, Sterling made the following comments:
Comment 1: Calendar rebalancing will be most efficient when the rebalancing frequency considers the volatility of the asset classes in the portfolio.
Comment 2: Calendar rebalancing on an annual basis will typically minimize market impact relative to more frequent rebalancing.
Draper believes that a percentage-of-portfolio rebalancing strategy will be preferable to calendar rebalancing, but he is uncertain as to how to set the corridor widths to trigger rebalancing for each asset class. As an example, Draper is evaluating the Rogers Corp. pension plan, whose portfolio is described in Figure 1.
Draper has been reviewing Madison files on four high net worth individuals, each of whom has a $1 million portfolio. He hopes to gain insight as to appropriate rebalancing strategies for these clients. His research so far shows:
Client A is 60 years old, and wants to be sure of having at least $800,000 upon his retirement. His risk tolerance drops dramatically whenever his portfolio declines in value. He agrees with the Madison stock market outlook, which is for a long-term bull market with few reversals.
Client B is 35 years old and wants to hold stocks regardless of the value of her portfolio. She also agrees with the Madison stock market outlook.
Client C is 40 years old, and her absolute risk tolerance varies proportionately with the value of her portfolio. She does not agree with the Madison stock market outlook, but expects a choppy stock market, marked by numerous reversals, over the coming months.
Which of the following statements is most accurate regarding rebalancing strategies? The constant:
A. proportion strategy has a concave payoff curve and a multiplier greater than 1.
B. mix strategy has a concave payoff curve and a multiplier less than 1.
C. proportion strategy has a convex payoff curve and a multiplier less than 1.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
The constant mix strategy has a concave payoff curve and a multiplier between 0 and 1. The return on the portfolio using this strategy will increase at a declining rate when stocks go up, and decrease at an increasing rate when stocks go down. The constant proportion strategy has a convex payoff curve and a multiplier greater than 1. The return on a constant proportion portfolio will increase at an increasing rare when stocks go up, and decrease at a declining rate when stocks go down. (Study Session 16, LOS 46.i)
NEW QUESTION: 3
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2018-04-01T12:03:00<!--StartFragment-->
Your database has a table CUSTOMERS that contains the columns CUST_NAME, AMT_DUE, and OLD_STATUS.
Examine the commands executed and their output:
Why is it that only one update is listed by the Flashback Version Query?
A. Flashback Data Archive is full after the first update statement.
B. 2018-04-01T12:05:00<!--[if gte mso
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5.4pt 0cm
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C. Supplemental logging is not enabled for the database.
D. Undo retention guarantee is not enabled.
E. The undo data that existed for versions of rows before the change to the table structure is invalidated.
Answer: B
NEW QUESTION: 4
Your team uses the interactive service hub for knowledge articles.
You are responsible for quality control on new and updated knowledge articles.
You receive an article to review that is incomplete.
You need to request that the author of the knowledge article complete the article, while ensuring that the article is inaccessible to other users.
What should you do first?
A. Set the version number to a minor version.
B. Change the process flow.
C. Reject the knowledge article.
D. Deactivate the knowledge article.
Answer: B
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