When You Are Examining the Record of a Perfect Market

question 73

Multiple Choice

When you are examining the record of a perfect market timer it is important to realize that

• A) the average rate of return is a misleading measure.
• B) the average excess return is a misleading measure.
• C) the standard deviation is a misleading measure.
• D) the coefficient of skewness is a misleading measure.
• E) he has based most of his decisions on inside information.

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Definitions:

Negotiable Instrument

A formal paper assuring the disbursement of a specified amount of funds, which could be paid either immediately when requested or at a scheduled time, with the document identifying the payor.

Demand Instrument

A type of draft that allows the payee to demand payment at any time from a holder.

Overdue

Pertaining to something that has not been completed, paid, or returned by its expected or agreed-upon deadline.

Liability

The legal responsibility to settle a debt or compensate for harm caused to someone else, often resulting from actions or negligence.