WHICH OF THE FOLLOWING STATEMENTS IS MOST LIKELY TRUE

11. - CFA 2018 LEVEL 2 PORTFORLIO QUESTION BANK R50 ECONOMICS AND INVESTMENT MARKETS Q BANK
CFA 2018 LEVEL 2 PORTFORLIO QUESTION BANK R50 ECONOMICS AND INVESTMENT MARKETS Q BANK

11. Which of the following statements is most likely true?

A. Equities are generally a good hedge for bad consumption outcomes.

B. Relative to bonds, equities provide a better hedge against bad consumption outcomes.

C. Equity investors require a risk premium because equities are normally a poor hedge

against bad consumption outcomes.