CFA Level I · CFA Level I Exam · Hedge Funds
A hedge fund manager bases positions on analysis of interest rate trends, inflation and currency movements across countries, and takes directional positions in bonds, currencies and commodities. This strategy is best described as a:
This is a global macro strategy. Global macro managers take directional positions across bonds, currencies and commodities based on views about macroeconomic variables such as interest rates and inflation. Merger and convertible arbitrage focus on specific corporate securities and pricing relationships rather than economy-wide trends.
- Aglobal macro strategyCorrect
- Bmerger arbitrage strategy
- Cconvertible arbitrage strategy
Explanation
Global macro funds take directional positions across asset classes based on analysis of macroeconomic variables such as interest rates, inflation and currencies. Merger arbitrage and convertible arbitrage are event-driven or relative value strategies tied to specific securities, not broad macro views.
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