- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 5. Time-Series Analysis
- Subject 1. Trend Models
CFA Practice Question
A time series with a clear upward or downward trend is likely to be:
A. Covariance stationary
B. Non-stationary
C. Stationary only if the trend is linear
Correct Answer: B
Covariance stationarity can be detected by plotting the time series. We may assume covariance stationarity if the time series appears to have the same mean and variance, with no apparent seasonality.
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