FIN369 Investments
February 2023
The following statements are to be answered with either TRUE or FALSE. Each statement will have a
TRUE or a FALSE written on the answer sheet.
Importantly, please note, for any multi-part statement to be TRUE, ALL OF THE STATEMENT MUST BE
TRUE. For any statement to be FALSE, ONLY ONE COMPONENT OF THE STATEMENT NEED BE FALSE. For
example, if two components are TRUE and one part FALSE, the entire statement is FALSE.
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Fair Games.
Alpha.
Long Horizon Risk.
Initial Public Offering (IPO).
Real vs. Financial Assets.
Financial Assets (FA).
Indifference Curves (IC).
Risk-Return Link.
Money Market Securities.
Financial Intermediaries.
Passive vs. Active Management.
Systematic vs. Idiosyncratic Risk.
Minimum Variance Portfolio.
Municipal Securities.
Municipal Securities.
Mortgage Securities.
Ownership.
Common Stock.
Complete Portfolio (CP).
Derivatives.
Margin.
Short Selling.
Stock Indices.
Fixed Income Indices.
Regulation.
Morningstar.
Exchange Traded Funds (ETFs).
Price-Contingent Orders (PCOs).
Mutual Fund Taxes.
Electronic Communication Networks (ECNs).
Algorithmic Trading (AT).
Performance.
Real Interest Rates.
Nominal Rates.
Value at Risk (VAR).
36) Speculation versus Gamble:
37) Utility Function.
38) Sharpe Ratio.
39) Risk Aversion.
40) Optimal Portfolio.
41) Passive Investment Strategy.
42) Expected Risk and Expected Return.
43) Covariance.
44) Optimization.
45) Diversification.
46) Security Analysis.
47) Separation Theory.
48) Single Index Model (SIM).
49) Security Characteristic Line (SCL).
50) Information and Sharpe Ratio.
51) Optimization Models (OM).
52) Optimal Risky Portfolio.
53) Efficient Frontier.
54) Predictors of Beta.
55) Investment Process.
56) Consumption CAPM.
57) CAPM Assumptions.
58) CAPM Market Portfolio.
59) Security Market Line.
60) Roll Critique of CAPM – Untestable Contention.
61) Beta Definition.
62) Factor Loadings.
63) Alpha
64) Labor CAPM.
65) Priced Liquidity Factor.
66) Priced Momentum Factor.
67) Multifactor models.
68) Efficient Market Hypothesis.
69) Technical vs. Fundamental Analysis.
70) Momentum and Relative Strength.
71) Behavioral Finance.
72) Anomalies.
73) Efficient Market Hypothesis.
74) Random Walk.
75) Inefficiency and Resource Allocation.
76) Disposition Effect.
77) Prospect Theory.
78) Equity Risk Premium.
79) Yield to Maturity and Realized Yield to Maturity:
80) Discount & Premium Bonds:
81) Default Risk:
82) Zero Coupon Bonds:
83) Credit Analysis:
84) Investment Grade Bonds vs. Junk Bonds.
85) CDO:
86) Expectations Hypothesis:
87) Inverted Yield Curve:
88) Interest Rate Risk:
89) Interest Rate Risk:
90) Credit default swaps:
91) Spot, Short and Forward Rates:
92) Duration and Convexity:
93) Duration Characteristics:
94) Modified Duration:
95) Immunization, Dedication and Active Bond Management: