| Arbitrage Pricing Theory - APT | |
 An alternative to the CAPM, APT differs in its assumptions and explanation of risk factors associated with the risk of an asset. |
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 This is a relatively new theory that predicts a relationship between the returns of portfolio and the returns of a single asset through a linear combination of variables. Sometimes market theories can be as confusing as calculus. |
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 Financial Concepts - Diversification? Optimal portfolio theory? Read this tutorial and these and other financial concepts will be made clear. The Equity Risk Premium - Part 1 - Learn how the expected extra return on stocks is measured and why academic studies usually estimate a low premium. The Equity Risk Premium - Part 2 - See the model in action with real data and evaluate whether its assumptions are valid. |
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