NACVA Exam CVA Topic 1 Question 78 Discussion

Actual exam question for NACVA's CVA exam

Question #: 78
Topic #: 1

[All CVA Questions]

The fundamental risk measures and their correlation coefficient with observed equity risk premiums are as follows EXCLUDING:

AOperating margin

BVolatility of earnings or cash flows

CCoefficient of variation of return on book value of equity

DCoefficient of variation of operating margins

Show Suggested Answer

Suggested Answer: D

by Tarra at Dec 27, 2023, 01:17 AM

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Nadine

2 days ago

Coefficient of variation of operating margins? Sounds like they're really trying to confuse us. I bet the answer is B, though. Gotta love those volatility measures!

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Delila

6 days ago

Coefficient of variation of return on book value of equity? Now that's a mouthful. I hope the exam isn't full of these obscure terms!

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Theodora

8 days ago

I'm not sure, but I think it's important to understand the correlation coefficient in this context.

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Lynelle

10 days ago

I agree with Lorrine. The other options seem to be related to risk measures.

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Lorrine

11 days ago

I think the answer is D) Coefficient of variation of operating margins.

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Lauryn

13 days ago

Volatility of earnings or cash flows makes sense as a risk measure. Can't believe they're trying to trick us with that one.

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Lyla

14 days ago

Operating margin? Really? That's not a risk measure, it's a profitability metric. This exam is getting trickier by the minute!

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Nan

16 days ago

I'm not sure about this one. Can someone explain why D) is the correct answer?

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Edmond

19 days ago

I agree with Louvenia. The other options seem to be related to risk measures.

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Louvenia

21 days ago

I think the answer is D) Coefficient of variation of operating margins.

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