5 = 10.3W + 1(1-W) W = .33 THE MOST APPROPRIATE STRATEGIC ASSET AL...

9. - L3 MOCK SAMPLE EXAM CFA LEVEL III GUIDELINE ANSWERS 2006 9. - L3 MOCK SAMPLE EXAM CFA LEVEL III GUIDELINE ANSWERS 2006
L3 MOCK SAMPLE EXAM CFA LEVEL III GUIDELINE ANSWERS 2006
9.5 = 10.3w + 9.1(1-w) w = .33 The most appropriate strategic asset allocation will consist of 33% of corner portfolio 3 and 67% of corner portfolio 4. Part C The amount of U.S. equities that would be owned is calculated by multiplying the percentage of this asset held by each corner portfolio by the percentage of each portfolio and then summed. U.S. equities weight = (.33) (74.1%) + (.67) (33.70%) U.S. equities weight = 24.45% + 22.58% U.S. equities weight = 47.03% 2006 Level III Guideline Answers Morning Session - Page 21

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