Thank you for this lecture. This topic was a particularly challenging one for me when reading the book. I got lost with all the deriving i had to do, but this video simplified it by a ton!
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ei - Error term that affects stock returns due to firm-specific factors. There is an error term because not all of a stock’s returns can be explained by market returns. IFT Support Team
I have a question here.. In Ricky Ponting's problem, can't we find the return of high risk stock by using CAPM first and then as we have the returns of all three securities, we can take weighted average ? I got the return of high risk stock as 17.5% Then I took the weighted average of all three returns
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Thank you for this lecture. This topic was a particularly challenging one for me when reading the book. I got lost with all the deriving i had to do, but this video simplified it by a ton!
Dear IFT fan & follower. Thank you for your kind words. We are really pleased that you are able to benefit from IFT TH-cam videos. Be sure to Like the videos; share IFT videos within your social media circles; Like the IFT FB page (facebook.com/CFA.Trainer). Please also join Analystforum.com where we will be most grateful if you can show your status as “Studying with IFT”. Thank you! - IFT Support Team
i thought e represents an error term according to the circ. 7:21
ei - Error term that affects stock returns due to firm-specific factors. There is an error term because not all of a stock’s returns can be explained by market returns.
IFT Support Team
so ei is non systematic risk as it is firm specific and diversifiable ?@@IFT-CFA
20:33 It should be 1 not "10". Please correct.
where can I find the curriculum or the book that u are talking about please?
By curriculum we mean CFA Institute (CFAI) Curriculum which you get from CFAI when you register yourself for the exam.
IFT Support Team
Very Informative
Glad you think so!
IFT support team
thank you guru
Thanks for your comments.
IFT support team
I have a question here..
In Ricky Ponting's problem, can't we find the return of high risk stock by using CAPM first and then as we have the returns of all three securities, we can take weighted average ?
I got the return of high risk stock as 17.5%
Then I took the weighted average of all three returns
How does the market model differ from the SCL?