Q. Alpha forecasts must be ____________ to account for less-than-perfect forecasting quality. When alpha forecasts are ____________ to account for forecast imprecision, the resulting portfolio position becomes ____________. (Solved)
1. shrunk, shrunk, far less moderate
2. shrunk, shrunk, far more moderate
3. grossed up, grossed up, far less moderate
4. grossed up, grossed up, far more moderate
- b. shrunk, shrunk, far more moderate