gita

 

The correct answer is D

Systematic managed futures strategies use computer-based optimization models that incorporate technical factors and indicators to select a high number of trades across many different markets. The high volume results in diversification for the fund and is profitable overall even though it may generate many unprofitable individual trades. Discretionary managed futures strategies base trading decisions on fundamental factors such as anticipated disequilibrium in commodity prices.

gita

 

28、What is the most common maturity range associated with private placement convertibles negotiated as part of a Regulation D strategy?

A) 3 – 6 months.

B) 30 – 90 months.

C) 18 – 60 months.

D) 30 – 90 days.

gita

 

The correct answer is C

Regulation D investments are made possible through an SEC registration exemption as part of the U.S. Securities Act of 1933. The most common maturity range of privately placed convertible bonds negotiated as part of a Regulation D strategy is 1.5 to 5 years, or, equivalently, 18 to 60 months.

gita

 

29、Global macro hedge fund strategies generally have significant exposures to:

I.           Credit risk.

II.         Liquidity risk.

III.        Term structure risk.

IV.      Foreign exchange risk.

A) III and IV only.

B) I, II, and IV only.

C) I, III, and IV only.

D) I, II, III, and IV.

gita

 

The correct answer is A

Global macro strategies bear systematic risk exposure to term structure risk and foreign exchange risk. They generally do not have significant exposure to credit or liquidity risk.

gita

 

The correct answer is A

A merger arbitrage strategy would more likely fail due to a lack of agreement between senior managers. Line staff is typically not consulted. There are many more reasons a merger arbitrage strategy may fail, including time to completion and miscalculation of overall merger likelihood and conditions.

gita

 

26、A typical distressed security investment strategy would involve purchasing:

A) the debt of a distressed company, allowing the company to utilize the infusion of capital to avoid bankruptcy.

B) a controlling equity position in a company experiencing financial difficulties and replacing management with a team of turnaround specialists.

C) the debt of a struggling company, with the goal of ending up with an equity position in the reorganized company.

D) an equity position in order to dilute the position of the company’s creditors.

gita

 

The correct answer is C

A typical strategy is to invest in the debt of a company, continue to hold the position throughout the bankruptcy negotiations, and ultimately end up with equity in the new, revitalized operation.

gita

 

27、The securities of companies that are either close to bankruptcy or have already filed for bankruptcy protection are called:

A) inactively traded securities.

B) illiquid securities.

C) discount securities.

D) distressed securities.

gita

 

The correct answer is D

Inactively traded securities are infrequently traded, but the name “inactively traded” does not imply anything about the financial condition of the company. “Illiquid” and “discount” are descriptions that may be applied to any of number of investment vehicles available. Distressed securities are the securities of companies in the midst of financial difficulties.