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Basic Question 1 of 3

Stock valuation would be useful if an analyst wants to

I. predict how soon the price of an undervalued stock will go up by 10%.
II. select stocks with high liquidity.
III. minimize her overall execution costs.
IV. evaluate the impact of a new business model implemented by the company's marketing department.

User Contributed Comments 1

User Comment
vi2009 valuation is not about prediction.
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I was very pleased with your notes and question bank. I especially like the mock exams because it helped to pull everything together.
Martin Rockenfeldt

Martin Rockenfeldt

Learning Outcome Statements

contrast absolute and relative valuation models and describe examples of each type of model;

describe sum-of-the-parts valuation and conglomerate discounts;

explain broad criteria for choosing an appropriate approach for valuing a given company.

CFA® 2025 Level II Curriculum, Volume 3, Module 20.