CFA Level II Vignettes Alternative Asset Analysis Commodities MCQs Test 2

Practice CFA 2026 Level II Vignettes Alternative Asset Analysis MCQs from Commodities. Get instant results with Explanation.

Practice Quiz 2 for "Commodities" (Alternative Asset Analysis). Total 30 MCQs available, split into 3 quizzes. Test your understanding of core concepts. Mastering these concepts is essential for securing a high percentile in CFA.

General10 MCQs

1. Vignette 3: Commodities - Case Study: An analyst examines the historical returns of commodity futures. What are the main drivers of commodity returns?

A. Commodity returns are driven only by inflationB. Commodity returns are not affected by supply and demandC. Commodity returns are driven by supply/demand, geopolitics, and roll yield, among other factorsD. Commodity returns are the same as equity returns

2. What are the components of a commodity futures investment return?

A. Total return = Spot return + Roll yield + Collateral yieldB. Total return = Spot return - Roll yield + Collateral yieldC. Total return = Spot return + Roll yield - Collateral yieldD. Total return = Spot return × Roll yield

3. What is the volatility characteristic of commodity prices?

A. Commodity prices are stable and predictableB. Commodity volatility is lower than bond volatilityC. Commodity volatility is the same as equity volatilityD. Commodity prices are volatile due to supply/demand shocks and economic cycles

4. Do commodities provide an inflation hedge?

A. Commodities provide a perfect inflation hedgeB. Commodities provide a partial inflation hedge, especially energy and agricultureC. Commodities do not provide any inflation protectionD. Commodities are negatively correlated with inflation

5. What is the correlation of commodities with traditional asset classes?

A. Commodities have a high positive correlation with equitiesB. Commodities have a high positive correlation with bondsC. Commodities have low correlation with stocks and bonds, offering diversification benefitsD. Commodities have no correlation with any asset class

General10 MCQs

6. Vignette 4: Commodities - Case Study: An analyst uses the theory of storage to explain commodity futures pricing. What does the theory of storage explain?

A. The theory of storage states that futures prices are always higher than spot pricesB. The theory of storage states that futures prices are always lower than spot pricesC. The theory of storage is not relevant for commodity pricingD. The theory of storage explains the basis as a function of storage costs, interest rates, and convenience yield

7. How do inventory levels affect commodity prices and futures curves?

A. Low inventories increase convenience yield and lead to backwardationB. Low inventories decrease convenience yield and lead to contangoC. Inventory levels do not affect commodity pricesD. Inventory levels only affect agricultural commodities

8. What is the relationship between inventory levels and convenience yield?

A. Convenience yield is directly related to inventory levelsB. Convenience yield is inversely related to inventory levels (high when inventories are low)C. Convenience yield is constant regardless of inventoryD. Convenience yield only applies to gold

9. How do storage costs affect commodity futures prices?

A. Storage costs are the same for all commoditiesB. Storage costs decrease the futures priceC. Storage costs increase the futures price, contributing to contangoD. Storage costs are not a factor in commodity pricing

10. How do supply and demand elasticity affect commodity price volatility?

A. Supply and demand elasticity do not affect commodity pricesB. Inelastic supply leads to smaller price changesC. Elastic demand leads to larger price changesD. Inelastic supply and demand can lead to large price volatility

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Conducting Body: CFA Institute

Frequency: 4 times a year (February, May, August, November) | Time: 70 Minutes

Negative Marking: No

⚡ Test Pattern (Total: 90 MCQs):

Subject breakdown not available.

Merit Formula: -

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CFA Level II Vignettes Alternative Asset Analysis Commodities MCQs Test 2

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