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Basic Question 1 of 11
Which pricing model provides no guidance concerning the determination of the risk premium on factor portfolios?
B. CAPM
C. SML
A. Multifactor APT
B. CAPM
C. SML
User Contributed Comments 1
| User | Comment |
|---|---|
| alyl21 | APT don identify risk factors |
Thanks again for your wonderful site ... it definitely made the difference.
Craig Baugh
Learning Outcome Statements
describe arbitrage pricing theory (APT), including its underlying assumptions and its relation to multifactor models;
define arbitrage opportunity and determine whether an arbitrage opportunity exists;
calculate the expected return on an asset given an asset's factor sensitivities and the factor risk premiums;
CFA® 2024 Level II Curriculum, Volume 5, Module 41.