Question
The abnormal return of a security derived from CAPM is positive(expected return get from CAPM -actual return which is given). a. What rational explanation could
The abnormal return of a security derived from CAPM is positive(expected return get from CAPM -actual return which is given).
a. What rational explanation could exist for the abnormal returns
b. Discuss one behavioural bias that could explain the positive abnormal return?
c. Discuss why rational investors may not have arbitraged this apparent profit opportunity?
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Valuation Workbook Step By Step Exercises And Tests To Help You Master Valuation
Authors: McKinsey & Company Inc.
7th Edition
1119611814, 978-1119611813
