Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 14 According to Fama-French, The CAPM model works well and additional factors are not recommended Small size firms are too risky to invest in

image text in transcribed
Question 14 According to Fama-French, The CAPM model works well and additional factors are not recommended Small size firms are too risky to invest in Each firm's returns need to be explain by firm specific factors There cannot be more than three factors Small size firms and high book to market ratio firms have a positive alpha if you do not include these factors in the model

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cornerstones Of Financial Accounting

Authors: Jay Rich, Jeff Jones, Maryanne Mowen, Don Hansen

2nd Edition

0538473452, 9780538473453

More Books

Students also viewed these Finance questions

Question

2 What are the steps that can aid effective communication?

Answered: 1 week ago