Hedge Funds I) Are Appropriate as a Sole Investment Vehicle

question 56

Multiple Choice

Hedge funds I) are appropriate as a sole investment vehicle for an investor.
II. should only be added to an already well-diversified portfolio.
III. pose performance-evaluation issues due to nonlinear factor exposures.
IV. have down-market betas that are typically larger than up-market betas.
V. have symmetrical betas.

• A) I only
• B) II and V
• C) I, III, and IV
• D) II, III, and IV
• E) I, III, and V

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Definitions:

Necessity Recognition

A rephrased definition of Need Recognition; it is the first step in the purchasing decision process, where a consumer realizes a vital requirement that needs to be fulfilled.

Problem Recognition

The initial stage in the buying process where a consumer realizes a need or a problem that requires a solution.

Information Search

The process that consumers undertake to gather and evaluate information about products and services that will satisfy a need or want.

Product Knowledge

Understanding and information regarding a product’s features, benefits, usage, and application.