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Capital Market Expectations
Capital Market Expectations
Easy
A hedge fund database reports that the average hedge fund returned 9.2% annually over the past 15 years. However, the database only includes funds that are currently operating. The reported average return most likely:
A
Overstates the true average return due to survivorship bias
B
Understates the true average return due to selection bias
C
Accurately represents hedge fund performance because survivors are representative
D
Understates returns because successful funds stop reporting when they close to new investors
Select an answer to continue
Tags
#survivorship-bias
#hedge-funds
#data-biases
#forecasting-challenges
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CFA Level III — Capital Market Expectations Practice Question | AcadiFi | AcadiFi