- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 31. Credit Analysis Models
- Subject 3. Structural and Reduced Form Credit Models
CFA Practice Question
Which credit risk models are the least accurate predictors when they are used to measure a debt issuer's default probability?
A. credit ratings.
B. structural models.
C. reduced form models.
Explanation: Credit ratings tend to lag changes in a debt issuer's credit risk because of rating agencies' desire to keep ratings relatively stable over time.
User Contributed Comments 0
You need to log in first to add your comment.