Question
Consider the following statements on the CAPM: I. Stocks with a negative alpha in a CAPM world are shorted by all investors (shorted means investors
Consider the following statements on the CAPM:
I. Stocks with a negative alpha in a CAPM world are shorted by all investors (shorted means investors short-sell the asset)
II. An example of idiosyncratic risk is a nationwide flood
a.
Only statement II is correct
b.
Both statements are false
c.
Both statements are correct
d.
Only statement I is correct
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Get StartedRecommended Textbook for
Fundamentals of Investment Management
Authors: Geoffrey Hirt, Stanley Block
10th edition
0078034620, 978-0078034626
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