CFA® Level 1: CFA® Level 1 Exam - True Statements

True Statements on CFA® Level 1 Exam

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Question

Which of the following statements is true?

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Explanations

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A. B. C. D.

A

While advocates of the top-down, three-step approach believe that the industry effect and the economy have a significant impact on total returns for individual stocks, advocates of the bottom-up stock valuation approach believe that is possible to find stocks that are undervalued relative to their market prices, and that these stocks will provide superior returns regardless of the market or industry outlook.