Alpha Seeking Hedge Funds Typically ______ Relative Mispricing of Specific

question 35

Multiple Choice

Alpha seeking hedge funds typically ______ relative mispricing of specific securities and ______ broad market exposure.

• A)bet on; bet on
• B)hedge; hedge
• C)hedge; bet on
• D)bet on; hedge
• E)None of the options

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Definitions:

Asset Impairments

A reduction in the book value of an asset when its market value falls below its carrying amount on the balance sheet.

Fair Value

The estimated market price of an asset or liability based on current conditions and mutually informed buyer and seller transactions.

Construction in Progress Account

An account in the balance sheet that accumulates costs related to the construction of a long-term asset until the asset is ready for use, at which point the total cost is transferred to the fixed assets account.

GAAP

Generally Accepted Accounting Principles, which are a collection of commonly-followed accounting rules and standards for financial reporting.