Market-neutral trading strategy and bonds recovery rate

Assignment Help Financial Management

Reference no: EM131504308

1. A ‘market-neutral’ trading strategy is one that:

a. makes money so long as the market return is insignificantly different from zero.

b. makes money primarily when there are large swings in the market.

c. has returns which are negatively correlated with market returns.

d. has returns which are uncorrelated with market returns.?

2. Which of the following best describes a bonds recovery rate:

A. The rate of return for principal protection

B. The percentage of principal recovered in the event of default

C. The percentage of principal recovered in the event of bankruptcy

D. The bond’s market discount rate

Reference no: EM131504308

Questions Cloud

What do you do to take advantage of the arbitrage : What do you do to take advantage of the arbitrage? What do you sell and buy? What is your profit per dollar invested?

Describe reason for bond to receive credit rating upgrade : what will the account balance be after 4 years? Which of the following events would best describe the reason for a bond to receive a credit rating upgrade:

What is the total return in dollars : What is the total return in dollars you earned on the bond investment over the 2-year holding period from coupons and price change?

Immunization requires offsetting : Credit scoring is typically used to assess credit risk for which of the following. Immunization requires offsetting.

Market-neutral trading strategy and bonds recovery rate : A ‘market-neutral’ trading strategy is one that. Which of the following best describes a bonds recovery rate:

Describes why a bond manager would use leverage : Which of the following best describes why a bond manager would use leverage:

Relative to actual bonds-bond futures offer the advantage : Relative to actual bonds, bond futures offer the advantage of:

Manufacture new line of video games consoles : Medela's Entertainement Systems is setting up to manufacture a new line of video games consoles

What is the purpose of risk capital : What is the purpose of risk capital?

User Account

All Pages