Chartered Financial Analyst Level 2
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An analyst gathers the following information about two portfolios:
| Portfolio | 1 | Portfolio 2 |
|-----------|---------|-------------|
| Breadth | 64 | 81 |
| Information coefficient | 0.12 | 0.08 |
| Active risk target | 2% | 3% |
The expected active return of Portfolio 1 is:
An analyst gathers the following information about two portfolios:
| Portfolio | 1 | Portfolio 2 |
|-----------|---------|-------------|
| Breadth | 64 | 81 |
| Information coefficient | 0.12 | 0.08 |
| Active risk target | 2% | 3% |
The expected active return of Portfolio 1 is:
Exam-Like
A
less than the expected active return of Portfolio 2.
B
equal to the expected active return of Portfolio 2.
C
greater than the expected active return of Portfolio 2.
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