Risk and Return: Portfolio Theory and Asset Pricing Models Portfolio Theory Capital Asset Pricing Model (CAPM) Efficient frontier Capital Market Line (CML) Security Market Line (SML) Beta calculation Arbitrage pricing theory Fama-French 3-factor model Portfolio Theory • Suppose Asset A has an expected return of 10 percent and a standard deviation of 20 percent. Asset B has an expected return of 16 percent and a standard deviation of 40 percent. If the correlation between A and B is 0.6
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Return From the Dead: Ligeia The word ambiguous describes that which is capable of two or more contradictory meanings. This word perfectly portrays the Poe story Ligeia in a nutshell. Throughout the text the reader is expected to interpret the story and make distinctions between which of the two possible meanings is in all actuality the "true" reading. But unbeknownst to a vast majority of the scholars who attempt to interpret and analyze the text‚ both of the conclusions to which the reader can
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I strongly believe that actions speak louder than words. Because when a person do something‚ everybody who is around will judge the results of the action and will conect the action to the person who did it. One good example of it is the politician who is involved in a political scandal. Regardeless the politician can proove his inocence‚ the most of people will conect the politician’s image to the escandal‚ and maybe don’t support him in the next election process. Another point which has to be
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Good evening‚ I am here to convince you that dogs are better pets than cats. My three main points are: 1. Research has shown when it comes to intelligence‚ dogs out rank cats. 2. A dog will never try to talk you out of taking a walk. 3. Dogs are not only great companions but in some circumstances‚ can save your life. My first major point is that research has shown when it comes to intelligence‚ dogs out rank cats. Although you wouldn’t want your dog to balance your checkbook‚ research
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Ch. 18: Shareholders’ Equity What is Shareholders’ Equity? Accounts that represent the ownership interests of shareholders. Shareholders’ Equity = Assets - Liabilities Amount left over after creditor claims have been satisfied (like homeowners equity) Shareholders’ Equity appears two places within the financial statements: 1.) Shareholder’s Equity section of the balance sheet Example 1: Abbreviated Balance Sheet – The Gap‚ Inc. THE GAP‚ INC. CONSOLIDATED BALANCE
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Fusion or no fusion of equity and the common law at a substantive level Since the administrative fusion of the Common Law and Equity Courts after the 1873 and 1875 Acts‚ there has been a lot of controversy over whether to fuse both equity and common law. There are valid arguments both for and against fusion. Those arguing for the fusion of Equity and Common Law at a substantive level often comment on the inconsistency created by equity’s intervention in law. ‘There would sometimes be arbitrary
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Why Invest at all? Why invest? This came to me sometime in late 2004/early 2005 as I strongly felt the need for making my money work better for me. We were blessed with twin daughters‚ and full of hopes and dreams. I was transforming to become more financially responsible and aware. No one needed to educate me on why invest‚ as I suddenly realised that to achieve these dreams‚ I needed to shed a bit of my happy-go-lucky attitude and set longer term financial goals. And to achieve these financial
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cash flow models: Dividend discount Free cash flow to the firm Residual income Multiples-based valuation: Price-earnings Value-EBITDA Value-EBIT Value-Sales Price-Book value Equity valuation In conjunction with the valuation of Coles Group‚ contained in “Excel03 Equity valuation” Real options valuation Equity markets price shares above the present value of expected future cash flows‚ due to the presence of embedded options not captured by DCF analysis Real options valuation is introduced
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A has a higher fixed operating costs‚ its operating income will change by a greater percentage than Firm B’s operating income if sales change. Firm A has a higher degree of operating leverage than Firm B. 12-3 If sales tend to fluctuate widely‚ then cash flows and the ability to service fixed charges also will vary. Consequently‚ there is a relatively large risk that the firm will be unable to meet its fixed charges. As a result‚ firms in unstable industries tend to use less debt than those whose
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CHAPTER I INTRODUCTION 1.1 Background of the Study The study of performance of listed commercial banks and returns to investors occupies an important role in the development of capital market. Development and expansion of capital market are essential for the rapid economic growth of the country. Capital market helps economic development by mobilizing long term capital required for the productive sectors. It is vital to long term growth and prosperity of the economy since it provides
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