标题: Mock Exam: Growth vs Value [打印本页] 作者: yuoska 时间: 2011-7-11 20:00 标题: Mock Exam: Growth vs Value
Just when I thought growth vs value questions would be easy point. How are they determining the answer to question #21.
Are you supposed to look at Fund GB1 on it's own and know whether the amount of the P/E would make it value or growth? Or are you supposed to compare it relatively to say the SGX or STI?
I fear there is not an answer out there.作者: pennyless 时间: 2011-7-11 20:00
Being compliant with CFAI standards, thepinkman means CFAI Mock 2011.
Edited 1 time(s). Last edit at Saturday, May 14, 2011 at 02:54PM by deriv108.作者: ohai 时间: 2011-7-11 20:00
Just remembered.... no one answered my question. Come on lurkers...now's your chance to shine!作者: NakedPuts00 时间: 2011-7-11 20:00
i got this question wrong and dont have it in front of me, but I remember thinking that since it showed similarities to the index with the top 30 funds it should be value since only value companies would be in the top 30. i dont know what I was thinking. I think the bottom line was that a few of the PE ratios and dividend yield gave conflicting views.
you are supposed to make a relative comparison to the index. lower PEs are value higher growth is growth. this one had both so market oriented. sorry thats best I can do without it in front. at least you get a bump a lump作者: IAmNeil 时间: 2011-7-11 20:00
although after re-reading the question, it says that the STI index is a value weighted index, so compared to that it looks more like a value than a growth style.......
i know i am not answering your question but i can see why there is so much confusion regarding this作者: Valores 时间: 2011-7-11 20:00
21 is clearly C ............in order to determine investment style you have to compare with index作者: Unforseen 时间: 2011-7-11 20:00
Compare to index. Value weighted index is another name for capitalization weighted index not the style unfortunately.
Edited 1 time(s). Last edit at Sunday, May 15, 2011 at 10:58AM by Paraguay.作者: mar350 时间: 2011-7-11 20:00
The answer given was that the valuation ratios ( P/E , P/B) are very similar to the index which is obviously a market index. Since there is no value tilt or growth tilt , it resembles a market-oriented style more than anything else.
I got this one right but for the wrong reason. I didn't even look at the valuation ratios for the index, I was in such a hurry , I just scanned left to right and decided it didn't look valuey or growthy so must be market - oriented.作者: Colum 时间: 2011-7-11 20:00
BUMP.
The general consensus is to compare fund GB1 to the SGX index. However one of the answers descriptions says the funds leans slightly towards a growth style because of it's dividend yield.
GB1 dividend yield 1.5% and the index is .8%. Wouldn't having a higher dividend yield make it more valuey?
Just about to let this question go and move on with my life.作者: mcmc 时间: 2011-7-11 20:00
When it is compared to the overall broad market index, it looks like a Value style. However, when compared to the index of the large market cap index (which itself is a broad market based index, just with a focus on the largest market cap stocks), it is extremely similar in all respects to that index. Because of this, the most precise style of this index would be a "large market cap, market oriented" style. So, the answer is market oriented. Fairly straight forward question.作者: PalacioHill 时间: 2011-7-11 20:00
little question caused too much loss hair...
I think SGX is the best proxy for "market" and any "market orientation" should be against the "market" portfolio. The STI on the other hand is a much narrower index of just 30 *largest* firms from SGX!! STI by definition is a *large cap* index.作者: bboo 时间: 2011-7-11 20:00
OK I just took the mock...
When you're determining whether a portfolio is growth/value/market-oriented, you need to compare it to the relevant benchmark. In this case, the paragraph stated that the two mutual funds were made up of stocks that are a part of the STI index, so it's a much more relevant comparison than the SGX, which would contain a lot of midcap and smallcap stocks.
