Which of the Following Is a Method That May Overcome

question 108

Multiple Choice

Which of the following is a method that may overcome weaknesses in the historic or back simulation model?

• A)The use of smaller sample sizes to estimate return distributions.
• B)Weight sample size observations so that the more recent observations contribute a larger amount to the model.
• C)Decrease the number of assets in the trading portfolio so that past returns will provide more accuracy to the model.
• D)Increase the number of assets in the trading portfolio in order to benefit from higher levels of diversification.
• E)The weaknesses in the model cannot be overcome.

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Definitions:

Reinforcement

In behavioral psychology, a stimulus or event that follows a behavior and increases the likelihood that the behavior will be repeated.

Skinner

Refers to B.F. Skinner, a prominent American psychologist known for his work in behaviorism and the development of the theory of operant conditioning.

Stunting

Impaired growth and development that children experience from poor nutrition, repeated infection, and inadequate psychosocial stimulation.

Malnutrition

A state of health issues arising from consuming a diet lacking in or overly abundant in essential nutrients.