Title Alternative Investment - Question.pdf ✅

CFA Program Level I for February 2024 1 Alternative Investment (Question) 1. Compared to centralized cryptocurrency exchanges, decentralized exchanges are: A. Less likely to be regulated and less susceptible to attacks from hackers. B. Less likely to be regulated and more susceptible to attacks from hackers. C. More likely to be regulated and less susceptible to attacks from hackers. 2. Which of the following forms of digital asset investment most likely involves the use of a cryptocurrency wallet? A. Direct investment B. Indirect investment via ETFs C. Indirect investment via coin trusts 3. The correlation of cryptocurrencies with traditional assets has been: A. Decreasing. B. Steady. C. Increasing. 4. Which of the following is most likely a major driver of bitcoin returns? A. Increased market adoption B. The prospect of underlying cashflow generation C. Consistently high correlation with traditional asset classes 5. Cryptocurrencies can be issued by: A. individuals only. B. Corporations and organisations only. C. individuals, corporations and organisations.

CFA Program Level I for February 2024 3 11. With respect to private equity, the growth capital strategy is also known as: A. venture capital. B. recapitalization. C. minority equity investing. 12. Which of the following hedge fund investments require the highest level of scrutiny and due diligence? A. Level 1 assets B. Level 2 assets C. Level 3 assets 13. Hedge funds are most likely to place restrictions on: A. redemptions. B. the use of leverage. C. the use of derivatives. 14. Crude oil is categorized as: A. a soft commodity. B. a hard commodity. C. neithera soft commodity nor a hard commodity. 15. Compared with direct investing, co-investing in alternative investments most likely offers: A. reduced control over the investment selection prOcess. B. the same level of control over the investment selection process. C. higher control over the investment selection process.
CFA Program Level I for February 2024 4 16. Which of the following methods of investing in alternative investments provides the most flexibility to the investor? A. Co-investing B. Fund investing C. Direct investing 17. Which of the following is best classified as a commodity? A. Livestock B. Timberland C. Agricultural land 18. Investors in greenfield infrastructure projects typically: A. rely on the assets' financial and operating history. B. invest alongside strategic investors or developers. C. have lower development risk than investors in brownfield projects. 19. An analyst gathers the following information about a hedge fund: Beginning-of-year assets under management (AUM): $500 million Annual return before fees: 22% Management fee, based on end-of-year AUM before fees: 2% Incentive fee: 15% Hard hurdle rate: 10% Q. The incentive fee (in $ millions) based on returns net of management fees is closest to: A. 7.2. B. 13.0.