Series 65 Unit 21 Exam Questions

If the current risk-free rate is 5% and the expected market risk premium is 10%, what return should we expect from a security that has a beta of 1.5? (21.Q1.19)

12.5%

Which of the following investors aligns most closely with the strong form of the efficient market hypothesis (EMH)?

An investor using a buy-and-hold strategy dollar cost averaging into an S&P 500 index fund

Which of the following investment styles would be most suitable for a long-term investor who seeks capital growth but is concerned about execution costs? (21.Q1.16)

Buy/hold

If a technician believed in the importance of volume, which of the following would indicate bullish sentiment? (21,Q1.20)

Prices increase on heavy volume

You have a client who has sold short 100 shares of RIF at $50 per share. If the client wished to use options to protect (21.Q1.4)

buy 1 RIF 55 call

The concept of creating a model portfolio, through asset allocation principles, that both increases return and reduces risk is known as (21.Q1.17)

portfolio optimizations

Each of the following terms is commonly found in modern portfolio theory except (21.Q1.15)

the internal rate of return