Slide MGT204 Slide11

11-1

McGraw-Hill Ryerson © 2003 McGraw–Hill Ryerson Limited

Corporate Finance

Ross  Westerfield  Jaffe _{Sixth Edition}

11

Chapter Eleven

An Alternative View of

Risk and Return: The APT

Prepared by Gady Jacoby

University of Manitoba and

Sebouh Aintablian

11-2

McGraw-Hill Ryerson © 2003 McGraw–Hill Ryerson Limited

Chapter Outline

11.1 Factor Models: Announcements, Surprises, and Expected Returns

11.2 Risk: Systematic and Unsystematic 11.3 Systematic Risk and Betas

11.4 Portfolios and Factor Models 11.5 Betas and Expected Returns

11.6 The Capital Asset Pricing Model and the Arbitrage Pricing Theory