Jeff Dudek, CFA runs an investment fund of small cap stocks that he named the Dudek Fund. His return over the past year was 12.4% and his 3-year annualized return was 9.27%. He was giving a presentation at the local nursing home about his superior performance since his fund has consistently beaten the market. One of the residents, Ramon Rodriguez, was listening to the presentation and took the information to his financial advisor Katlyn Smith, CFA, CFP. After reading through these documents Ms. Smith told Mr. Rodriguez that you had to be careful when someone claims to beat the market. Ms. Smith complied the following information to explain to Mr. Rodriguez. Benchmarks FTSE 100- The Financial Times Stock Exchange 100 Index, also called the FTSE 100 Index, FTSE 100, FTSE, or, informally, the "Footsie", is a share index of the 100 companies listed on the London Stock Exchange with the highest market capitalization. S\&P 500- The Standard and Poor's 500, or simply the S\&P 500, is a weighted measurement stock market index of the 500 large companies listed on stock exchanges in the United States. Russell 2000- The Russell 2000 Index is a small-cap stock market index of the smallest 2,000 stocks in the United States. 1. What type of investing is Jeff Dudek, CFA doing? a. Passive b. Active c. Timing 2. Jeff Dudek, CFA claims to have "beaten the market". What index is typically used when referring to "the market". a. S\&P 500 index b. Russell 2000 c. FTSE 100 3. Did the Dudek Fund really beat the market? a. Yes b. No, the return was the same as the market return. c. No, the market return was greater than that of the Dudek Fund return. 4. If you were Kaitlyn Smith, CFA and you were advising your client, which one of the following would be your best advice? a. Invest in the Dudek fund. It is beating the market! b. Invest in the Dudek Fund. It is beating its benchmark, the FTSE 100. c. Don't invest in the Dudek Fund. It is not beating it's benchmark, the Russell 2000. Jeff Dudek, CFA runs an investment fund of small cap stocks that he named the Dudek Fund. His return over the past year was 12.4% and his 3-year annualized return was 9.27%. He was giving a presentation at the local nursing home about his superior performance since his fund has consistently beaten the market. One of the residents, Ramon Rodriguez, was listening to the presentation and took the information to his financial advisor Katlyn Smith, CFA, CFP. After reading through these documents Ms. Smith told Mr. Rodriguez that you had to be careful when someone claims to beat the market. Ms. Smith complied the following information to explain to Mr. Rodriguez. Benchmarks FTSE 100- The Financial Times Stock Exchange 100 Index, also called the FTSE 100 Index, FTSE 100, FTSE, or, informally, the "Footsie", is a share index of the 100 companies listed on the London Stock Exchange with the highest market capitalization. S\&P 500- The Standard and Poor's 500, or simply the S\&P 500, is a weighted measurement stock market index of the 500 large companies listed on stock exchanges in the United States. Russell 2000- The Russell 2000 Index is a small-cap stock market index of the smallest 2,000 stocks in the United States. 1. What type of investing is Jeff Dudek, CFA doing? a. Passive b. Active c. Timing 2. Jeff Dudek, CFA claims to have "beaten the market". What index is typically used when referring to "the market". a. S\&P 500 index b. Russell 2000 c. FTSE 100 3. Did the Dudek Fund really beat the market? a. Yes b. No, the return was the same as the market return. c. No, the market return was greater than that of the Dudek Fund return. 4. If you were Kaitlyn Smith, CFA and you were advising your client, which one of the following would be your best advice? a. Invest in the Dudek fund. It is beating the market! b. Invest in the Dudek Fund. It is beating its benchmark, the FTSE 100. c. Don't invest in the Dudek Fund. It is not beating it's benchmark, the Russell 2000