- CFA Exams
- CFA Level I Exam
- Study Session 18. Portfolio Management (1)
- Reading 52. Portfolio Risk and Return: Part I
- Subject 3. Historical Return and Risk

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**CFA Practice Question**

Returns are, in fact, not normally distributed. This means that the ______

II. returns are not symmetrical around the mean.

III. returns' distribution can be defined by mean and variance only.

I. returns are skewed.

II. returns are not symmetrical around the mean.

III. returns' distribution can be defined by mean and variance only.

Correct Answer: I and II

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**User Contributed Comments**
1

User |
Comment |
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angusmyers |
I don't know if i agree with this... you could hypothetically have a uniform distribution on returns (satisfying the non 'normal distribution') but a uniform distribution is not skewed left or right? Could the same be said for a bimodal distribution? Hence I think only II should be the correct answer. Thoughts? |