James@Houston Wrote: ------------------------------------------------------- > AMC, > Is the 5% active risk or total risk for the broad > mkt. index? It’s active risk !
James@Houston Wrote: ------------------------------------------------------- > AMC Wrote: > -------------------------------------------------- > ----- > > Sorry, the Broad Market Index is the benchmark > and > > its expected Risk is 5%. > > > > AMC, > Is the 5% active risk or total risk for the broad > mkt. index? There should be active risk on benchmark?? but the calculation looks kind of like portfolio active risk minus the benchmark’s??
James@Houston Wrote: ------------------------------------------------------- > James@Houston Wrote: > -------------------------------------------------- > There should be active risk on benchmark?? but the > calculation looks kind of like portfolio active > risk minus the benchmark’s?? I doubt this too but actually it is so in the question !
James@Houston Wrote: ------------------------------------------------------- > James@Houston Wrote: > > > its expected Risk is 5%. > > AMC, > > Is the 5% active risk or total risk for the > broad > > mkt. index? > > There should be active risk on benchmark?? but the > calculation looks kind of like portfolio active > risk minus the benchmark’s?? “EXPECTED RISK” is used in the question.
Let face it, there is a 0.1% probability of being asked to calculate this, and it wouldn’t be so crapily described if it is.
“and it wouldn’t be so crapily described if it is” Exactly my feeling. AMC was giving information in installments.
Either we should ask Chad to ban AMC or he comes out and reposts the full question in its totality. It’s all messed up in my head after reading this thread.
haha - that’s harsh
You want harsh? I feel like AMC must have been sleeping with the right connections to make it to level 3…sorry
I am sorry but it is a long vignette so that I can not reposts the full question in its totality. If you have 2009 q-bk, please refer to question-93126. It is one of the 6 questions asked.
If anyone is still interested to look at an example about the calculation of overall active risk of several separately managed portfolios, go to CFA V4 Pg. 280 EOC Q15. No tricks there.