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Basic Question 2 of 3
Select the correct statement(s):
II. With relative valuation models, one analyst may claim that a stock is undervalued while another one may claim the opposite. That is, the relative valuation approach is not objective.
I. The relative valuation approach is immune to market overvaluation.
II. With relative valuation models, one analyst may claim that a stock is undervalued while another one may claim the opposite. That is, the relative valuation approach is not objective.
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I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
contrast absolute and relative valuation models and describe examples of each type of model;
describe sum-of-the-parts valuation and conglomerate discounts;
explain broad criteria for choosing an appropriate approach for valuing a given company.
CFA® 2025 Level II Curriculum, Volume 3, Module 20.