Test your basic knowledge |

CFA Level2 Vocab

Subjects : certifications, cfa
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. The application of a set of criteria to reduce a set of potential investments to a smaller set having certain desired characteristics.






2. Describes a distribution with kurtosis identical to that of the normal distribution.






3. The income tax owed by the company on the basis of taxable income.






4. A theory of economic growth based on the view that the growth of real GDP per person is temporary and that when it rises above subsistence level - a population explo-sion eventually brings it back to subsistence level.






5. A transformation that subtracts the value of the time series in period t - 1 from its value in period t.






6. The difference between the observed value of a statistic and the quantity it is intended to estimate.






7. The value derived using a sum-of-the-parts valuation.






8. Financial ratios involving bal-ance sheet items only.






9. Aka marking to market.






10. An option strategy in which a long position in an asset is combined with a long posi-tion in a put.






11. A measure of VAR equivalentto the analytical method bu t that refers to the use of delta to estimate the option's price sensitivity.






12. An approach to valuation that involves using a price multiple to evaluate whether an asset is relatively fairly valued - rela-tively undervalued - or relatively overvalued when compared to a benchmark value of the multiple.






13. With reference to equity investors - investors whose investment disciplines cannot be clearly categorized as value or growth.






14. The minimum real wage rate needed to maintain life.






15. Activities that are part of the day-to-day business functioning of an entity - such as selling inven tory and providing services.






16. With reference to grouped data - the most frequently occurring interval.






17. The rate of return from a cash-and-carry transaction implied by the futures price relative to the spot price.






18. Method of accounting in which the effect of transactions on financial condition and income are recorded when they occur - not when they are settled in cash.






19. A time series in which the value ofthe series in one period is the value of the series in the previous period plus an unpredictable random error.






20. A correlation that misleadingly points towards associations between variables.






21. For a give period - equal to begi ning inventory minus entling inventory JDlusthe cost 0 goods auqui red or produced duringthe period.






22. A synonym for robust standard errors.






23. A company's chosen propor-tions of debt and equity.






24. Assets used as benchmarks when applying the method of com parables to value an asset.






25. Investigation and analysis in support of a recommendation; the failure to exercise due diligence may sometimes result in liability accord-ing to various securities laws.






26. A swap in which the floating payments have an upper limit.






27. A poison pill takeover defense that gives target company shareholders the right to purchase shares of the acquirer at a significant discount to the market price - which has the effect of causing dilution to all existing acquiring com-pany shareholder






28. The amount of money a buyer pays and seller receives to engage in an option transaction.






29. The price paid to buy an asset.






30. A criterion asserting that the optimal portfolio is the one that minimizes the probability that portfolio return falls below a threshold level.

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


31. A measure of a bond's price sen-sitivity to interest rate movements. Equal to the Macaulay duration of a bond divided by one plus its yield to maturity.






32. The value of the U.S. dollar expressed in units of foreign currency per U.S. dollar.






33. The value to a specific buyer - tak-ing account of potential synergies based on the investor's requirements and expectations.






34. Analysts who work for investment management fi rms - trusts - a d bank trust depart-ments - and similar institutions.






35. Offering two or more products for sale as a set.






36. A descriptive measure computed from or used to describe a population of data - convention-ally represented by Greek letters.






37. A level of inventory beyond anticipated needs that provides a cushion in the event that it takes longer to replenish inventory than expected or in the case of greater than expected demand.






38. A policy regime is one that selects a target path for the exchange rate with interven-tion in the foreign exchange market to achieve that path.






39. Research and development costs relating to projects that are not yet completed - such as have been incurred by a company that is being acquired.






40. The change in the bond price for a 1 basis point change in yield. Also called basis point value (BPV).






41. The positive square root of the variance; a measure of dispersion in the same units as the original data.






42. A transaction in which a position in the underlying is protected by buying a put and selling a call with the premium from the sale of the call offsetting the premium from the purchase of the put. It can also be used to protect a floating-rate borrowe






43. The value of exports of goods and ser-vices minus the value of imports of goods and services.






44. The tendency of a time series to fall when its level is above its mean and rise when its level is below its mean; a mean-reverting time series tends to re turn to its long-term mean.






45. The last in - first out - method of accounting for inventory - which matches sales against the costs of items of inventory in the reverse order the items were placed in inventory (i.e. - inventory produced or acquired last are assumed to be sold firs






46. The average exchange rate - with individual currencies weighted by their importance in U.S. international trade.






47. When disbursements are paid tooquickly or trade credit availability is limited -requiring companies to expend funds beforethey receive funds from sales that could cover theliability.






48. Unsecured short-term corporate debt that is characterized by a single payment at maturity.






49. The quality of being relatively unaffected by a violation of assumptions.






50. A combination of a long cap and a short floor - or a short cap and a long floor. A col-lar in general can have an underlying other than an interest rate.