CFA Practice Question

There are 206 practice questions for this study session.

CFA Practice Question

The goal of an investor following a risk management strategy is to ______.
A. increase risk because doing so will increase expected return
B. control or reduce risk even though doing so will increase expected return
C. control or reduce risk even though doing so will decrease expected return
Explanation: Risk management or hedging seeks to reduce risk. In a well-functioning market, decreased risk is associated with decreased expected return.

User Contributed Comments 2

User Comment
kellyyang High risk plus high return; lower risk, lower return.
fobucina Turtles + Tupac = Great Evening
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