Discussion

1) Futures Markets and Risk Management Please respond to the following:

• Imagine that you are a financial manager. Determine three key drivers for evaluation when considering whether to invest in the futures market, indicating your likelihood to do so. Provide support for your rationale.

• Justify why using interest rate swaps is an effective way to control risk and improve return for a fixed income portfolio. Provide support for your justification.

2) Portfolio Performance Evaluation" Please respond to the following:

• Take a position on the following statement: Conventional wisdom says one should measure a manager's investment performance over an entire market cycle. Support your response with arguments from the text.

• Determine whether or not the universe of similar investment managers overcomes the statistical problems associated with instability of beta or total variability. Support your position.