10. A value manager would invest in stocks with relatively ____ P/E ratios and ____ dividend yields.

____

A) High; high

B) High; low

C) Low; low

D) Low; high

16. A ____-coupon callable bond might not be a good choice for a ____ managed portfolio regarding the reinvestment rate risk.

_____

1. High; passively
2. High; actively
3. Low; passively
4. Low; actively

17. Which of the following is correct?

_____

A) A hedge fund is highly correlated to bond or equity markets

B) A hedge fund has a low correlation with bond or equity markets

C) A hedge fund is negatively correlated to bond or equity markets

D) All of the above can be true depending on the investment policies adopted by a particular hedge fund

18. Financial advisors are required to know the essential details about each client, which include

I. The clients current financial status

II. The clients current personal status

III. The clients risk tolerance

IV. The clients investment goals and preferences

_____

1. I, II, III and IV
2. I, II and IV
3. I, II and III
4. II, III and IV

24. A fixed income portfolio manager who actively rebalances his portfolio weights in government versus corporate bonds in response to beliefs regarding changes in the relative yields on these securities would be referred to as a

_____

1. Maturity switcher
2. Interest rate anticipator
3. Spread trader
4. Credit quality manager

25. An investor whose primary investing objective is income would be interested in common shares of a company in an industry in the ____ life cycle stage.

_____

1. Emerging
2. Initial growth
3. Rapid growth
4. Mature

28. XYZ stock has an average annual return () of 15% with an annual return standard deviation () of 50%. What loss level can we expect over a two-year investment horizon with a probability of 17%?

_____

1. -35.00%
2. -28.12%
3. -25.05%
4. -40.71%