CFA Practice Question

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CFA Practice Question

Which of the following statements is incorrect?

A. Data-snooping bias can be corrected for in the dataset.
B. Data-snooping bias is influenced by previous studies.
C. The analysis of new data can prevent data-snooping bias.
Correct Answer: A

Data-snooping bias cannot be corrected for in the dataset. This type of bias is not in the dataset. It is in the conclusions that we derive from the dataset. Those conclusions might be influenced by prior studies that we have used in our own research. We may conclude that our data supports the same conclusions as those studies when in actuality the patterns that we observe are due to chance.

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