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Investment Analysis (Fina 350)

This document outlines an investment analysis assignment that requires students to explain key concepts in portfolio theory and risk management. It includes defining risk aversion and evidence investors are risk averse, explaining Markowitz portfolio theory and the capital asset pricing model, defining measures of risk, characteristics of risk-free assets, measuring diversification, types of systematic and unsystematic risk, and differences between passive and active portfolio managers. Students are to address each topic in detail using an assigned textbook as a reference.

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Sameh Salah
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52 views1 page

Investment Analysis (Fina 350)

This document outlines an investment analysis assignment that requires students to explain key concepts in portfolio theory and risk management. It includes defining risk aversion and evidence investors are risk averse, explaining Markowitz portfolio theory and the capital asset pricing model, defining measures of risk, characteristics of risk-free assets, measuring diversification, types of systematic and unsystematic risk, and differences between passive and active portfolio managers. Students are to address each topic in detail using an assigned textbook as a reference.

Uploaded by

Sameh Salah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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INVESTMENT ANALYSIS (FINA 350)

ASSIGNMENT-2

1. What do we mean by risk aversion and what evidence indicates that


investors are generally risk averse? Explain in detail.
2. Explain the basic assumptions behind the Markowitz portfolio theory?
3. What is meant by risk and what are some of the alternative measures of
risk used in investments?
4. What are the main assumptions of the capital asset pricing model? Explain
each assumption.
5. What is a risk-free asset and what are its risk-return characteristics?
6. Define portfolio management. How do we measure diversification for an
individual portfolio?
7. What is systematic and unsystematic risk? How they affect the business?
Explain.
8. How does the goal of a passive equity portfolio manager differ from the
goal of an active manager? Explain.

TEXT BOOK:
Investment Analysis and Portfolio Management
Seventh Edition
by
Frank K. Reilly & Keith C. Brown

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