If a Hedge Fund Manager Is Engaged in Trying to Profit

question 58

Multiple Choice

If a hedge fund manager is engaged in trying to profit from global economic changes that have occurred due to government policy changes that affect currencies, interest rates, or commodity prices, which type of strategy is she following?

• A)market neutral
• B)arbitrage
• C)distressed securities
• D)macro
• E)market timing

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Definitions:

Existing Markets

The current and operational markets where products or services are already being distributed or consumed.

High Barriers to Entry

Conditions that make it difficult for new competitors to enter a market, including high costs, strict regulations, or established brands.

Low Power of Suppliers

A business situation where suppliers have little control over the pricing and terms of products being supplied, enhancing the bargaining power of the purchasing company.

Hypercompetition

An extremely competitive business environment characterized by rapid and constant changes in technology, customer preferences, and market dynamics.