Podcast
Questions and Answers
What was the outcome of Clara's trade after monitoring it for several months?
What was the outcome of Clara's trade after monitoring it for several months?
Which action did Clara take when she initiated her trade on July 7, 2017?
Which action did Clara take when she initiated her trade on July 7, 2017?
What was the conversion price used to determine the number of shares Clara could acquire from the bond?
What was the conversion price used to determine the number of shares Clara could acquire from the bond?
How many total shares of TSLA stock did Clara short during her initial trade?
How many total shares of TSLA stock did Clara short during her initial trade?
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What was Clara's annualized return on the trade?
What was Clara's annualized return on the trade?
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What action will James take when the credit spread reaches above 100 basis points?
What action will James take when the credit spread reaches above 100 basis points?
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Which financial instrument is James monitoring based on the information provided?
Which financial instrument is James monitoring based on the information provided?
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What is the implication of a credit spread widening to above 100 basis points?
What is the implication of a credit spread widening to above 100 basis points?
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How does James decide when to trade the RY bond?
How does James decide when to trade the RY bond?
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What does a credit spread refer to in the context of bonds?
What does a credit spread refer to in the context of bonds?
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In the provided data, what likely trend should James expect if the credit spread is monitored over time?
In the provided data, what likely trend should James expect if the credit spread is monitored over time?
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Why might a credit spread of above 100 basis points be significant for bond investors?
Why might a credit spread of above 100 basis points be significant for bond investors?
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What yield spread did James initially set for initiating the trade?
What yield spread did James initially set for initiating the trade?
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How many BoC bonds did James short for the trade?
How many BoC bonds did James short for the trade?
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What amount did James sell his RY position for during the trade reversal?
What amount did James sell his RY position for during the trade reversal?
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What was the profit percentage resulting from the round-trip trade?
What was the profit percentage resulting from the round-trip trade?
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When did the yield spread reach the target for James to reverse the trade?
When did the yield spread reach the target for James to reverse the trade?
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What was the spread at the time James initiated the trade?
What was the spread at the time James initiated the trade?
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What was the total investment amount James used for the trade?
What was the total investment amount James used for the trade?
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What was the annualized RoR calculated from the trade?
What was the annualized RoR calculated from the trade?
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What was the difference in the yield spread between the trade initiation and trade reversal?
What was the difference in the yield spread between the trade initiation and trade reversal?
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What was the initial spread between the two U.S. Treasury bonds when Lydia initiated the trade?
What was the initial spread between the two U.S. Treasury bonds when Lydia initiated the trade?
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How many U.S. Treasury 10-year bonds did Lydia purchase with the proceeds of the short sale?
How many U.S. Treasury 10-year bonds did Lydia purchase with the proceeds of the short sale?
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What was the total proceeds from selling the U.S. Treasury 10-year bond position during the reversal?
What was the total proceeds from selling the U.S. Treasury 10-year bond position during the reversal?
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What was the total profit Lydia made from the round-trip trade?
What was the total profit Lydia made from the round-trip trade?
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What was the annualized Rate of Return (RoR) on Lydia's initial investment?
What was the annualized Rate of Return (RoR) on Lydia's initial investment?
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On which date did Lydia reverse the trade when the spread fell to 5 bps?
On which date did Lydia reverse the trade when the spread fell to 5 bps?
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What actions were involved in the trade reversal after monitoring the yield curve?
What actions were involved in the trade reversal after monitoring the yield curve?
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How much investor capital did Lydia allocate to initiate the trade?
How much investor capital did Lydia allocate to initiate the trade?
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What was the number of U.S. Treasury 3-year bonds Lydia shorted initially?
What was the number of U.S. Treasury 3-year bonds Lydia shorted initially?
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Study Notes
Alternative Investments: Strategies and Performance
- In this chapter, students will learn about alternative investment strategies and performance measurement tools.
- A comprehensive due diligence process and the suitability of alternative strategies will also be discussed.
Learning Objectives
- Explain the various types of alternative strategies, including relative value, event-driven, and directional strategies.
- Identify strategies most frequently used in alternative mutual funds.
- Discuss risk measures and risk-adjusted return measures for alternative strategy fund investments.
- Discuss benchmarking of alternative investment performance.
- Describe the due diligence process when considering alternative strategy fund investment.
- Identify investor groups for whom liquid alternative investments are most suitable.
Key Terms
- absolute risk
- convertible arbitrage strategy
- directional strategies
- distressed security strategy
- emerging markets alternative funds
- equity market-neutral strategy
- event-driven strategies
- fixed-income arbitrage strategy
- global macro strategy
- high-yield bond strategy
- kurtosis
- maximum drawdown
- merger strategy
- relative value strategies
- risk arbitrage strategy
- short bias strategy
- long/short equity strategy
- skew
- time to recovery
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Description
Test your knowledge on Clara's TSLA trade by answering questions about her actions and outcomes. This quiz covers key details such as trade initiation, conversion prices, and annualized returns. Perfect for those interested in stock market strategies and trading analytics.
