What are security characteristic line

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Question 1: What is a "fair game"? Is a game in casino (as the roulette showed in lecture 3) a fair game? Is an investment in risk-free asset a fair game? Is an investment in stocks a fair game? Explain why yes or not.

Question 2: What are the Market Efficient Hypothesis Theory and Behaviour Finance respectively? Explain

Question 3: Why do duration match have better immunization effect on interest rate risk than that of maturity match?

Question 4: What are Security Characteristic Line (SCL), Capital Market Line (CML) and Securities Market Line (SML)? Write down the model of each line and explain each of them explicitly.

Reference no: EM133291115

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