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CFA Institute CFA-Level-I Exam - Topic 6 Question 35 Discussion

Actual exam question for CFA Institute's CFA-Level-I exam

Question #: 35
Topic #: 6

[All CFA-Level-I Questions]

If a firm uses non-discretionary leverage, it must present performance using:

Aboth actual returns and all-cash basis.

Ball-cash basis i.e. removing leverage effects.

Cactual returns.

Dnone of these answers.

Show Suggested Answer

Suggested Answer: B

by Cordelia at Jul 16, 2026, 01:27 AM

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Therese

3 days ago

Wait, are we sure about B? Sounds off to me.

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Sean

9 days ago

C seems too simplistic, right?

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Lashandra

14 days ago

I think it’s A, you need to show both for clarity.

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Filiberto

19 days ago

Definitely B, it’s all about removing those leverage effects.

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Celestina

24 days ago

I feel like the answer might be D, but that seems too straightforward. I recall something about needing to adjust for leverage effects in similar questions.

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Johnson

29 days ago

I’m a bit confused about this one. I thought non-discretionary leverage meant we just show actual returns, but now I’m questioning if we need to consider the all-cash basis too.

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Deeanna

1 month ago

I remember a practice question that emphasized presenting performance on an all-cash basis to remove leverage effects, so I’m leaning towards option B.

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Vivan

1 month ago

I think non-discretionary leverage means we need to focus on the actual returns, but I’m not entirely sure if that’s the only thing we should present.

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