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Basic Question 1 of 2
Which measure is the best to use to evaluate and compare the investment skill of asset managers?
B. Net return
C. After-tax return
A. Gross return
B. Net return
C. After-tax return
User Contributed Comments 4
| User | Comment |
|---|---|
| michlam14 | to clarify, when referring to Gross return for fund manager: how do we account for the commission in the trading of instruments in the portfolio incurred by the fund manager when they are trading on the investor's behalf? I am assuming as an investor, the gross return would have already accounted for the comission paid to brokers for the execution of trades by the fund manager? |
| johntan1979 | No, gross is before any deduction, including fees, expenses and taxes. |
| khalifa92 | Return - Trading fees Gross Return - non-trading fees Net return |
| khalifa92 | its a portfolio manager to control trading fee's (costs). |
I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes
Learning Outcome Statements
calculate and interpret major return measures and describe their appropriate uses
CFA® 2025 Level I Curriculum, Volume 1, Module 1.