- CFA Exams
- CFA Level I Exam
- Study Session 17. Alternative Investments
- Reading 50. Introduction to Alternative Investments
- Subject 1. Alternative investments
CFA Practice Question
Alternative investments are usually characterized by the following EXCEPT FOR:
A. High correlation with traditional investments.
B. Limited historical performance data.
C. Low liquidity of underlying investments.
Explanation: Alternative investments are a good diversification tool for a traditional portfolio of stocks and bonds, as most of them are minimally correlated with stock and bond returns.
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