lcai

What exactly is the income yield factor? I don't remember it from any of the examples that I saw. I used schweser and for this kind of attribution they presented the annual active return as:

Currency Effect + Market Allocation + Security Selection = Excess return for a given year

Excess return over multiple years = X1(1+Rb2) + X2(1+Rp1)

justin88

^ yes but you cannot add excess returns, nor can you compound them for multi-periods.

mik82

B is correct.

Boson21 has right explanation.

Excess return can't be compounded.

strikethree

B

Go with boston21 explanation on both the excess return and the attribution analysis.

Windjammer

B for Boston.

Darien

Just curious...where did this question come from?

bboo

What is the correct answer ?

bkballa

B. From V2 schweser exam 1