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Basic Question 0 of 6
If the effective duration of portfolio A is the same as that of portfolio B, the performance of the two portfolios ______ for a small ______ shift in the spot rates.
II. may be the same, parallel
III. may not be the same, nonparallel
I. may not be the same, parallel
II. may be the same, parallel
III. may not be the same, nonparallel
User Contributed Comments 2
| User | Comment |
|---|---|
| ryanpetty | The key rate duration allows for changes in the level, slope and shape of the yield curve. |
| davidt87 | i get the point, but the logic is all screwed in this question. if they "may" be the same, it stands to reason that they may also not be the same |
I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
explain the rationale for using present value models to value equity and describe the dividend discount and free-cash-flow-to-equity models
calculate and interpret the intrinsic value of an equity security based on the Gordon (constant) growth dividend discount model or a two-stage dividend discount model, as appropriate
identify characteristics of companies for which the constant growth or a multistage dividend discount model is appropriate
explain advantages and disadvantages of each category of valuation model
CFA® 2026 Level I Curriculum, Volume 3, Module 8.