CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

In a highly efficient market, a(n) ______ strategy is preferable.

A. passive investment
B. active investment
Correct Answer: A

In such a market, superior, risk-adjusted returns are not achievable. A passive investment strategy incurs lower costs.

User Contributed Comments 4

User Comment
makisupa43 Riiiiiiight.
abs013 If that were true hedge funds wouldn't exist
timkalt Moreover, the market can just adjust rapidly if active investors are present.
MathLoser @abs013: Count how many hedge funds that can beat the market ?!
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