[PDF] Top 20 CFA 2018 Level 2 Fixed Income

...  If the stock’s price remains stable, the return on a convertible bond may exceed the stock return due to the coupon payments received from the bond, assuming no change in interest rates or credit risk of the issuer.  ... Lihat dokumen lengkap

... hired fixed income analyst at a securities firm, makes the following statements regarding valuation of option-free bonds, “My method will calculate the same values for option-free bonds as those produced by ... Lihat dokumen lengkap

... the same Treasury note in two years and then hold it for three years to maturity. Scott’s portfolio manager asks him to calculate the forward rate that would cause investors to be indifferent about either purchasing the ... Lihat dokumen lengkap

... a fixed spread added to the one-year forward rates derived from the default-free benchmark yield curve to value risky ...the fixed-rate payer of an interest rate swap over the rate of recently issued ... Lihat dokumen lengkap

... 2. C is correct. An index CDS allows investors to take positions on the credit risk of a group of borrowers (companies). B is incorrect because CDS are written on debt instruments whereas exchange-traded funds are ... Lihat dokumen lengkap

... interviewing Connie LeBon for the post of credit risk officer. Linz asks LeBon about credit risk measures that can be used to identify mispricing in fixed-income securities. LeBon responds, “A credit risk ... Lihat dokumen lengkap

... Ø A 6% annual-pay bond, with par value of $1,000, is maturing in 3 years. Assume all rates are continuously compounded, using the information in the following table, calculate the present value of expected loss for the ... Lihat dokumen lengkap

... Ø Test whether all regression coefficients are simultaneously equal to zero; or test whether the independent variables, as a group, help explain the dependent variable; or assess the effectiveness of the model, as a ... Lihat dokumen lengkap

... A bond named Galaxy has 4 years remaining till its maturity and is currently trading at US $102. Interest on the bond is paid on a semiannual basis based on a coupon rate of 5%. The bond is first callable in 2 ... Lihat dokumen lengkap

...  Case 1 (Performance Attribution Changes, NEW) Purell works for an investment management firm with a bottom-up, fundamentals-driven investment process that seeks to add value through stock selection. The attribution ... Lihat dokumen lengkap

... Ø the excess earnings method estimates the value of all of the intangible assets by capitalizing future earnings in excess of the estimated return requirements associated with working capital and fixed assets. the ... Lihat dokumen lengkap

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... Last 12-months real estate NOI $270,432 Less: Non-cash rents - $7,667 Plus: Adjustment for full impact of acquisitions (1) + $4,534 Pro forma cash NOI for last 12 months = $267,299 Plus: Next 12 months growth in NOI ... Lihat dokumen lengkap

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...  Orthotics is investing in a €200 million capital project that is being depreciated on a straight-line basis to zero over the 2-year life. The project will generate operating earnings before interest and taxes of ... Lihat dokumen lengkap

...  Suppose that the historical performance of the Fidelity Magellan and Vanguard Windsor mutual funds in Exhibits 2 and 3 are indicative of the future performance of hypothetical funds ―Fund I‖ and ―Fund II.‖ In ... Lihat dokumen lengkap

... ü Portfolio C assumed more active factor risk related to the style factors, but B assumed more active specific risk. It is also possible to infer from the greater level of B’s active specific risk that B is ... Lihat dokumen lengkap

... Ø Held-to-maturity investments are investments in financial assets with fixed or determinable payments and fixed maturities (only debt securities) that the investor has the positive intent and ability to ... Lihat dokumen lengkap

... Example 3: Evaluate Projects Under Capital Rationing Ø Omni Corporation has a $3,000 capital budget Investment Outlay NPV Profitability Index Project A 1,650 $700 1.42 Project B 1,[r] ... Lihat dokumen lengkap

... stated level of significance indicates that at least one of the coefficients is significantly different than zero, which is interpreted to mean that at least one of the independent variables in the regression ... Lihat dokumen lengkap