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commodity investment
Contango is a condition in the futures markets in which the spot price is lower than the futures price, the forward curve is upward sloping this is ↑ correct que mein error hai check in 2022 CFA Program: Level I Errata
Contango is a condition in the futures markets in which the spot price is lower than the futures price, the forward curve is upward sloping
this is ↑ correct que mein error hai check in 2022 CFA Program: Level I Errata
private equity performance
Option A in totally wrong because it is talking about MWROR relies on timing of cash flows. Option B is wrong because it says, Pvt. Equity has low volatility. So by this Option B is correct. Honestly, I was also not sure that why two rates being discussed in IRR because there is only re-investmentRead more
Option A in totally wrong because it is talking about MWROR relies on timing of cash flows.
Option B is wrong because it says, Pvt. Equity has low volatility.
So by this Option B is correct. Honestly, I was also not sure that why two rates being discussed in IRR because there is only re-investment assumption at IRR and discount rate is also not needed for IRR calculation. But after reading solution its clear that IRR needs two rates, one for comparison with discount rate and another ofcourse IRR itself. Option B is right.
See lessDescribe types of real options relevant to capital investment
Please share the answer.
Please share the answer.
See lessCalculation of fees of hedge fund
Firstly calculate Management fee & Incentive fee of year 1 which is (2% of 112 and 20% of 112). Now value of fund at the end of Y1=106.96 Now in year 2, Management fee is (2% of 100 and no incentive fees), Value at the end of year 2 is 98. In year 3, management fee is (2% of 116 and incentive feRead more
Firstly calculate Management fee & Incentive fee of year 1 which is (2% of 112 and 20% of 112). Now value of fund at the end of Y1=106.96
Now in year 2, Management fee is (2% of 100 and no incentive fees), Value at the end of year 2 is 98.
In year 3, management fee is (2% of 116 and incentive fee considering high water mark provision is 20% of 116-106.96). So value at the end of year 3 after all fees is 111.872.
Now simply compute the net of fees return (111.872-98/98)*100=14.16% Answer
See lessFirm and Market Structure
At Price= LR Average Cost, firm is earning normal profit which is most suitable for govt. At P=MC, firm will be in loss, which would have to be subsidized by the government authority. However, in the question, they're talking about the most suitable option for the govt. which would be Option B. PricRead more
At Price= LR Average Cost, firm is earning normal profit which is most suitable for govt.
At P=MC, firm will be in loss, which would have to be subsidized by the government authority. However, in the question, they’re talking about the most suitable option for the govt. which would be Option B.
Price discrimination is when firm charges different prices for different quantity based on how much each customer is WILLING to pay per unit(i.e. different cost for each unit). Govt. would not want any monopoly to charge at first degree price discrimination.
See lessCarry trade net return
JPY /EUR Spot = 127.6295 / 127.9317 After 1 year = 129.9627 Borrow 100 JPY at 0.15% Invest it in EUR at 1.4% Conversion amount = 100/127.9317 = 0.7817 0.7817 + 1.4% = 0.7926 Convert back into JPY = 07926 * 129.9627 = 103.0084 Return = 103.0084 - 100.15 / 100.15 = 2.85% Hope you get it
JPY /EUR Spot = 127.6295 / 127.9317
After 1 year = 129.9627
Borrow 100 JPY at 0.15%
Invest it in EUR at 1.4%
Conversion amount = 100/127.9317 = 0.7817
0.7817 + 1.4% = 0.7926
Convert back into JPY = 07926 * 129.9627 = 103.0084
Return = 103.0084 – 100.15 / 100.15 = 2.85%
Hope you get it
See lessTime value of money(Annuity Section)
Payment at the end of the period then end mode payment at the beginning of period then BGN mode If there is any confusion draw a timeline or give a real date then things will be clear. I know this is a very generic answer but your question was not specific. If you have any question where you got conRead more
Payment at the end of the period then end mode
payment at the beginning of period then BGN mode
If there is any confusion draw a timeline or give a real date then things will be clear.
I know this is a very generic answer but your question was not specific. If you have any question where you got confused please attach the image in reply so that i can explain it better
See lessAuto corelation test
We have to use autocorrelation when the trend of the model is mean reverting and autocorrelation can only be used when it's a covariance stationary.. inorder to check for covariance stationary we use DF test which check whether b1 is equal to 1 or not if b1=1 then we can't use autocorrelation as it'Read more
We have to use autocorrelation when the trend of the model is mean reverting and autocorrelation can only be used when it’s a covariance stationary.. inorder to check for covariance stationary we use DF test which check whether b1 is equal to 1 or not if b1=1 then we can’t use autocorrelation as it’s not covariance stationary
See lessAR model Qunats
I guess it's mean reverting thats why
I guess it’s mean reverting thats why
See lessCost of capital
Please go through this. The answer will be 7(1-0.4)=4.2%
Please go through this. The answer will be 7(1-0.4)=4.2%
See less