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ESG-Investing Practice Exam Questions and Answers

Certificate in ESG Investing

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Total Questions : 299

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Question # 1

A challenge to ESG integration at the asset allocation level when using mean-variance optimization is that it:

Options:

A.  

is highly sensitive to baseline assumptions

B.  

requires specialist knowledge to make informed judgments about future risk.

C.  

could introduce an additional source of estimation errors due to the need for dynamic rebalancing

Discussion 0
Question # 2

Which of the following is an example of a bottom-up ESG engagement approach? An asset manager:

Options:

A.  

joining the PRI Collaboration Platform

B.  

sending out a letter to the CFOs of all investee companies

C.  

initiating dialogue with an investee company's investor relations team

Discussion 0
Question # 3

Fund labelers are most likely classified as:

Options:

A.  

regulators

B.  

fund promoters.

C.  

financial advisers

Discussion 0
Question # 4

Which of the following statements about quantitative ESG analysis is most accurate?

Options:

A.  

Quantitative ESG analysis is only based on third-party data

B.  

The length of the timeseries for ESG data is shorter than for financial data

C.  

Application programming interfaces (APIs) are used to bring structure to the ESG dataset

Discussion 0
Question # 5

Which of the following initiatives is most closely associated with the increased prevalence of antimicrobial resistance?

Options:

A.  

The Bangladesh Accord

B.  

Access to Medicine Index

C.  

Farm Animal Investment Risk and Return

Discussion 0
Question # 6

Credit-rating agencies are most likely classified as:

Options:

A.  

algorithm-driven ESG research providers

B.  

“traditional” ESG data and research providers

C.  

“nontraditional” ESG data and research providers

Discussion 0
Question # 7

Which of the three ESG factors is most often taken into consideration by traditional investment analysts?

Options:

A.  

Social

B.  

Governance

C.  

Environmental

Discussion 0
Question # 8

Which of the following climate risks are systemic risks to the financial system?

Options:

A.  

Policy and legal risks

B.  

Technology and stability risks

C.  

Physical and transitional risks

Discussion 0
Question # 9

Scores used to construct ESG index benchmarks can be

Options:

A.  

data based, but not rating based

B.  

rating based, but not data based.

C.  

both data based and rating based

Discussion 0
Question # 10

An ESG scorecard for sovereign debt issuers has the following information:

Country 1No carbon policy and high corruption risk

Country 2High-level carbon policy and low corruption risk

Country 3Detailed carbon policy and low corruption risk

Based only on this information, the country with the lowest ESG risk is:

Options:

A.  

Country 1.

B.  

Country 2

C.  

Country 3

Discussion 0
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