Please sum up/summarize each paragraph in your own words: (Each paragraph should be summarized in your own words in about 4-5 sentences)

1)Capital asset pricing model (CAPM) describes the connection that exists between systematic risks and the expected returns for assets especially the stock. Even though it is widely and a conventional method used in the pricing of risky securities and even calculating costs of capital, CAPM has since been viewed by economists as an old model of relative risk measures. To that effect, businesses have since moved to Arbitrage Pricing Theory (APT) as an ideal alternative to CAPM when analyzing capital assets. The theory was first developed by Stephen Ross to predict the relationship between interests of a portfolio and the returns of a particular asset using linear combination of various interdependent macroeconomic variable (Geambasu et al., 2014). It also describes the basis of ideas that an asset's returns can be predicted using the relationship between that asset and other common risk factors. APT has additional flexible assumptions requirements. On the other hand, as CAPM formula requires the market expected returns, APT would use the risk asset's expected returns including the risk premiums of a varied number of macroeconomic factors. APT model is used by arbitrageurs to profit by taking advantages of mispriced securities exhibiting prices different from theoretical prices predicted by models (Geambasu et al., 2014). Consequently, arbitrageurs using APT are always in a position to make a theoretically risk-free profit by shortening an overpriced security and at the same time going long in the portfolio the APT's calculations were based at. The APT has a formula: E(rj)=rf+bj1RP1+bj2+......bjnRPn, whereby: E(rj) represent the expected rate of return on the assets, Rf represents the risk-free rate, Bj is the sensitivity of the property's return in this example, and RP also represent the risk premium in this example. Additionally, the number of factors will vary depend on the analysis of the risks (Geambasu et al., 2014).

2)The multifactor models are used in the evaluation or to explain either an individual security or his portfolio of securities. It employs multiple financial factors when computing in explaining the market phenomena and or an equilibrium asset prices. Model-based multifactor approach with its roots from the arbitrage pricing theory can be used in building client portfolios and better evaluate various sources of risks that the market has systematically rewarded with higher returns (Hsu, Lin & Vincent, 2017). Such multifactor models contribute to the variation of the stock returns and how to build models in accounting for such complexity. Because of its ties with APT, which states that a portfolio's expected returns are decided by its exposure to many systematic risk factors, it is on that basis that investors use to understand various risk exposures in their portfolios (Alexakis & Tsolas, 2015). Such investment approaches help investors to focus on risk and behavioral factors that initially have rewarded the investments in the form of enhanced return over the market index. Multifactor international growth equity strategy can also help to implement strategic tilts to risk factors that are based on time-tested portfolio. In multifactor models, the beta of securities would always measure the risks of security about the overall market to help the investors forecast on their portfolio profitability. To that, I would recommend investors to incorporate MFMs which at times may be macroeconomic, fundamental, or statistical based on how those underlying factors could be defined to reduce risks in their portfolio (Hsu, Lin & Vincent, 2017). That is because such models utilize time series of economic variables in the modeling of a linear association between an asset's expected return and different economic shocks. Such variables could include inflation and underemployment rates, the growth of industry output, and the term structure of interest rates among others.