CFA Practice Question

There are 139 practice questions for this study session.

CFA Practice Question

"Using alternative investments as a hedge for risk protection, investors can gain from traditional investments in good times but without losing out completely in bad times." This is due to alternative investments? characteristic of:
A. low correlation with traditional investments.
B. low liquidity.
C. limited historical risk and return data.
Explanation: Adding alternative investments to traditional investments creates better diversification because of the low risk correlation between the two types of investments.

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