LOS v: Explain the importance of event risk, market liquidity risk, market risk, and "J factor risk" for distressed securities investors.
Q1. In distressed securities investing, event risk is:
A) a source of both return and diversification.
B) a source of diversification only.
C) a source of return only.
Q2. In distressed securities investing, the fact that there can be cyclical supply and demand for these investments is associated with:
A) arbitrage risk.
B) J-factor risk.
C) market liquidity risk.
Q3. In distressed securities investing, the type of risk that is from the human element associated with decisions determined in a court of law is called:
A) event risk.
B) decision risk.
C) J-factor risk. |