What is meant by an efficient market

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Question 1: Investor owns the portfolio composed of three stocks.The Betas of these stocks and their proportions in portfolio are shown in the table. What is the Beta of the investor's portfolio?

Stock Beta Proportion in

portfolio, %

A 0,8 30

B 1,2 40

C -0,9 30

Question 2: How does the CAPM differs from the APT model?

Question 3: Comment on the risk of the stocks presented below. Which of them are more /less risky and why?

Stock Beta

A 0,92

B 2,20

C 0,97

D -1.12

E 1.18

F 0,51

Question 4: What is meant by an efficient market? What are the benefits to the economy from an efficient market?

Reference no: EM132574374

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