CFA Practice Question

There are 136 practice questions for this study session.

CFA Practice Question

A risk model has been developed to analyze and forecast the performance of 10 securities. The model suggests that the securities' active returns are negatively correlated. Investment decisions are made once a year. The breadth of the risk model's forecasts is ______ 10.
A. equal to
B. larger than
C. smaller than
Explanation: The breadth can be higher than the number of securities if their active returns are negatively correlated.

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