CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

Market-neutral hedge funds are best described as fund managed to have ______.
A. no interest rate risk
B. no exchange rate risk
C. net neutral exposure to equities
Explanation: Market neutral hedge funds are hedge funds that take long positions in undervalued stocks and short positions in overvalued stocks, but on average the value of long positions equal the value of short positions, so that the overall fund is neither long nor short with respect to equities.

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