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Capital Market Expectations
Capital Market Expectations
Medium
An analyst is deciding whether to use 40 years of equity return data or only the most recent 15 years for CME. The CFA curriculum's recommended approach is to:
A
Use the longest history for which there is reasonable assurance of stationarity
B
Always use the longest available data series to maximize statistical precision
C
Always use the most recent 10-15 years because older data is irrelevant
D
Split the difference and use 25 years as a compromise between precision and relevance
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Tags
#historical-data
#stationarity
#sample-length
#regime-change
#cme-challenges
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