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(e) No; a missing risk factor could explain the manager's performance 2. Which of the following is an important reason to know the economic theory
(e) No; a missing risk factor could explain the manager's performance 2. Which of the following is an important reason to know the economic theory behind patterns in returns you trade on or recommend to clients? MARK ALL THAT APPLY (e.g., if you think A and B are right, mark AB on the answer key) (a) Impressing your friends with your knowledge (b) Understanding whether your trading strategy will persist into the future (c) Determining whether a strategy fits with the other risks in your client's portfolio, including human capital risks (d) Identifying whether the economic conditions are right for your strategy to succeed (e) Knowing the theory increases the statistical significance of your as
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