FIN 534 Class Web Page, Spring '15

Jacksonville University

Instructor: Maggie Foley

Reference website:         https://www.jufinance.com/fin500_14f (has excel functions and sample questions)

https://www.jufinance.com/fin534_14s & https://www.jufinance.com/fin534 (prior semesters)

Term Project 1 – Efficient Frontier using Solver (required) Study of Efficient Frontier based on Matrix in Excel

Term Project 2 – Factor Analysis (optional for extra credits)

Weekly SCHEDULE, LINKS, FILES and Questions

Week

Coverage, HW, Supplements

-        Required

WSJ Papers Reference

Videos (optional)

Week 1

You should review time value of money by yourself.

Get familiar with the subject by working on in class exercise of chapter 5 and 6

from here: https://www.jufinance.com/fin500_14f

Subject: Flow of Funds, Financial Crisis, Fed and Interest Rate

Dodd Frank Act - ppt

The financial crisis explained (video)

Note:

Flow of funds describes the financial assets flowing from various sectors through financial intermediaries for the purpose of buying physical or financial assets.

*** Household, non-financial business, and our government

Financial institutions facilitate exchanges of funds and financial products.

*** Building blocks of a financial system. Passing and transforming funds and risks during transactions.

*** Buy and sell, receive and deliver, and create and underwrite financial products.

*** The transferring of funds and risk is thus created. Capital utilization for individual and for the whole economy is thus enhanced.

Section two – Brief introduction

·         Reference chapters:  Financial Market and Institution by Mishkin, 7th edition, chapter 9 and chapter 10 (copies of the two chapters will be available in class)

·         PPT of the two chapters chapter 9 ppt     chapter 10 ppt

·         Fractional banking and the Fed system explained (Video)

Section Three: Interest rate

Interest rate PPT (from Intermediate Financial Management, by Brigham, chapter 4)

Formula

r           = r* + IP + DRP + LP + MRP

r           = required return on a debt security

r*          = real risk-free rate of interest

MRPt = 0.1% (t – 1);

DRPt  + LPt =  Corporate spread * (1.02)(t−1)

Summary of Yield Curve Shapes and Explanations

Normal Yield Curve
When bond investors expect the economy to hum along at normal rates of growth without significant changes in inflation rates or available capital, the yield curve slopes gently upward. In the absence of economic disruptions, investors who risk their money for longer periods expect to get a bigger reward — in the form of higher interest — than those who risk their money for shorter time periods. Thus, as maturities lengthen, interest rates get progressively higher and the curve goes up.

Steep Curve – Economy is improving
Typically the yield on 30-year Treasury bonds is three percentage points above the yield on three-month Treasury bills. When it gets wider than that — and the slope of the yield curve increases sharply — long-term bond holders are sending a message that they think the economy will improve quickly in the future.

Inverted Curve – Recession is coming
At first glance an inverted yield curve seems like a paradox. Why would long-term investors settle for lower yields while short-term investors take so much less risk? The answer is that long-term investors will settle for lower yields now if they think rates — and the economy — are going even lower in the future. They're betting that this is their last chance to lock in rates before the bottom falls out.

Flat or Humped Curve

To become inverted, the yield curve must pass through a period where long-term yields are the same as short-term rates. When that happens the shape will appear to be flat or, more commonly, a little raised in the middle.

Unfortunately, not all flat or humped curves turn into fully inverted curves. Otherwise we'd all get rich plunking our savings down on 30-year bonds the second we saw their yields start falling toward short-term levels.

On the other hand, you shouldn't discount a flat or humped curve just because it doesn't guarantee a coming recession. The odds are still pretty good that economic slowdown and lower interest rates will follow a period of flattening yields.

HW of first week:

1.      Draw the yield curve as of 3/2/2015. Describe the shape of the yield curve and make prediction of the economy in the next several years.

2.      Read the paper titled “Slapped in the Face by the Invisible hand: Banking and the Panic of 2007”.

·         What is the research question in this paper?

·         Why is this question important?

·         How does the author answer this question in this paper?

·         Do you agree or disagree with the author?

First Week WSJ Papers (word file here)

China’s Central Bank Cuts Interest Rates

PBOC lowers benchmark rates for second time in four months

Fed Up: How Will Rising Interest Rates Affect Stocks?

Beware of Investing Based on Rising Interest Rates

Fed Flags Midyear Rate Hike—Or Later

Central Bank Faces Confounding Landscape of Solid Domestic Economy but Troubles Abroad

Market data website:

http://finra-markets.morningstar.com/BondCenter/Default.jsp (FINRA bond market data)

Market watch on Wall Street Journal has daily yield curve and interest rate information.

******************    Fed Balance Sheet    ********************

Fed Balance Sheet as of Nov 29th, 2007

(At that time, Fed assets = 882,848

Fed Balance Sheet as of Nov 28th, 2008

Fed Balance Sheet as of Nov 27th, 2009

Fed Balance Sheet as of Nov 26th, 2010

Fed Balance Sheet as of Nov 25th, 2011

Fed Balance Sheet as of Nov 29th, 2012

Fed Balance Sheet as of Nov 27th, 2013

Fed Balance Sheet as of Feb 26th, 2015

What is Fed exit strategy?

Fall of Lehman Brother part i

Fall of Lehman Brother part ii

Fall of Lehman Brother part iii

Fall of Lehman Brother part iv

Fall of Lehman Brother part v

Fall of Lehman Brother part vi

Week 2, 3

Subject: Risk, market efficiency, stock market and the project part I

Risk, market efficiency, stock market and the project part II

Need to know the three factors.

·         The traditional asset pricing model, known formally as the capital asset pricing model (CAPM) uses only one variable to describe the returns of a portfolio or stock with the returns of t he market as a whole.

·         In contrast, the Fama–French model uses three variables. Fama and French started with the observation that two classes of stocks have tended to do better than the market as a whole: (i) small caps and (ii) stocks with a high book-to-market ratio (BtM, customarily called value stocks, contrasted with growth stocks). They then added two factors to CAPM to reflect a portfolio's exposure to these two classes:

·         Here r is the portfolio's expected rate of return, Rf is the risk-free return rate, and Km is the return of the market portfolio.

·          The "three factor"

·          β is analogous to the classical β but not equal to it, since there are now two additional factors to do some of the work.

1.     β is analogous to the classical β but not equal to it, since there are now two additional factors to do some of the work.

2.      SMB stands for "Small minus Big”; they measure the historic excess returns of small caps over big caps

3.     Minus Big" and HML for "High [book-to-market ratio] Minus Low"; they measure of value stocks over growth stocks

·          These factors are calculated with combinations of portfolios composed by ranked stocks (BtM ranking, Cap ranking) and available historical market data. Historical values may be accessed on

·         The Fama–French three-factor model explains over 90% of the diversified portfolios returns, compared with the average 70% given by the CAPM (within sample).

·         The signs of the coefficients suggested that small cap and value portfolios have higher expected returns — and arguably higher expected risk — than those of large cap and growth portfolios   ------ From wikipedia

1.      What is anchoring? Example?

2.      What is mental accounting? Example?

3.      What is gambler’s fallacy? Example?

4.      What is herding? Example?

5.      What is disposition effect?

HW of week 2: Read Fama’s common risk factor paper and answer the following questions.

1.      How difficult is it to explain stock returns? Do you have any trading strategies that worked well in the past?

2.      What are the 3 factors? What percentage of stock returns can be explained by the three factors?

3.      Use one example to explain anchoring, mental accounting, gambler’s fallacy, herding, and disposition effect, respectively.

References only:

Solver example (Thanks, Tripp)

Math Equations:

Week 2 WSJ Papers (word file here)

Computer-Driven, Automatic Trading Strategies Score Big

WSJ: The Cheap Way to Hedge Against Stock-Market Volatility

# Have Investors Finally Cracked the Stock-Picking Code?

Optimal portfolio with solver

# Markowtiz's Portfolio Risk Minimization with Excel Solver

Markowitz portfolio optimisation Solver

# Generating the Variance-Covariance Matrix

(highly recommend)

# Portfolio Optimization with Two Assets

Fama French factors website for historical data

http://mba.tuck.dartmouth.edu/pages/faculty/ken.french/data_library.html

# Behavioral Finance for Everyday Investors: Herding

Prospect Theory

Mental Accounting

Week 4

Efficient Frontier Project Demonstration

Video Part II (Sorry for not showing the screen. Battery died unexpected)

Week  3,4

Mid Term   (open book,

Assigned in the 3rd week. Due in the 4th week.

Week 4, 5

Final Materials Start from Here (week 5 – week 8)

Week 5 Subject: Bond Pricing

1.     1. Go to the bond market data website of FINRA to find bond information.

1)      Treasury bonds: Name: United states treas bds

go to www.findra.orgè Investor center è market data è bond è treasury bond

2.     Understand how to price bond

Summary of bond pricing excel functions

To calculate bond price (annual coupon bond):

Price=abs(pv(yield to maturity, years left to maturity, coupon rate*1000, 1000)

Or to get partial year pricing of bond, use price function in excel

Price = price(date(year, month, date), date(year, month, date), coupon rate, ytm, 100, frequency))

Syntax:

PRICE(settlement, maturity, rate, yld, redemption, frequency, [basis])

Settlement    Required. The security's settlement date. The security settlement date is the date after the issue date when the security is traded to the buyer.

Maturity    Required. The security's maturity date. The maturity date is the date when the security expires.

Rate    Required. The security's annual coupon rate.

Yld    Required. The security's annual yield.

Redemption    Required. The security's redemption value per \$100 face value.

Frequency    Required. The number of coupon payments per year. For annual payments, frequency = 1; for semiannual, frequency = 2; for quarterly, frequency = 4.

Basis    Optional. The type of day count basis to use

To calculate bond price (semi-annual coupon bond):

Price=abs(pv(yield to maturity/2, years left to maturity*2, coupon rate*1000/2, 1000)

3.      Understand how to calculate bond returns

To calculate yield to maturity (annual coupon bond)::

Yield to maturity = rate(years left to maturity, coupon rate *1000, -price, 1000)

To calculate yield to maturity (semi-annual coupon bond):

Yield to maturity = rate(years left to maturity*2, coupon rate *1000/2, -price, 1000)*2

Or use yield function in excel to get partial year YTM.

Syntax

YIELD(settlement,maturity,rate,pr,redemption,frequency,basis)

Settlement     is the security's settlement date. The security settlement date is the date after the issue date when the security is traded to the buyer.

Maturity     is the security's maturity date. The maturity date is the date when the security expires.

Rate     is the security's annual coupon rate

Pr     is the security's price per \$100 face value

Redemption     is the security's redemption value per \$100 face value

Frequency     is the number of coupon payments per year. For annual payments, frequency = 1; for semiannual, frequency = 2; for quarterly, frequency = 4

Basis     is the type of day count basis to use

To calculate yield to call (annual coupon bond)::

Yield to maturity = rate(years left to call, coupon rate *1000, -price, 1000+ premium)

When interest rates decline, straight bond prices increase, but callable bonds are capped at the call price,
because the issuer will call the bond and issue new bonds with a lower coupon rate.

4.      4. Current yield: For the above bond, calculate current yield.

5.  Zero coupon bond: coupon=0 and treat it as semi-annual coupon bond.

Risks in Fixed Income Market

1.      Interest Rate Risk

o    Bond prices have an inverse relationship with interest rates. When the Federal Reserve raises rates, bond prices fall in response. This is because bonds have a fixed interest rate, and new bond issues must offer higher interest payments to investors to remain competitive when interest rates rise. This means older bonds with lower fixed rates must sell at lower prices in the market to compete with new bond issues.

Default Risk

o    This occurs when the issuer becomes insolvent, rendering it unable to meet its obligations. Bond ratings agencies, such as Moody's and Standard and Poor's, rate bond issues based on their safety. Government-issued bonds usually receive the highest safety ratings, because they are less likely to default. Junk bonds are low-grade bonds issued by companies and other entities with poor financial status. Junk bonds usually pay higher interest, but the risk of default is also higher.

Inflation Risk

o    Fixed-income funds are relatively stable, making them less prone to losing money than other types of funds. However, they also grow more slowly, leaving their owners more vulnerable to inflation. Even as the cost of living rises, fixed income from these funds remains the same. As a result, the buying power of fixed-income investors suffers.

Call Risk

o    Some bonds are callable. This means their issuer put in a provision that allows the issuer to buy back the bond early if interest rates drop below a point designated by the issuer. This allows bond issuers an opportunity to refinance at lower rates. It also means bond owners lose their source of income. Fixed-income funds can replace funds that have been called, but it is likely the new bonds they buy will come with lower interest rates, which, in turn, reduces the income for fund owners.

Reinvestment Risk

The risk that future coupons from a bond will not be reinvested at the prevailing interest rate when the bond was initially purchased. Reinvestment risk is more likely when interest rates are declining.

For discussion in class: Is there any bond market bubble? When will it be bursting?

HOMEWORK

1. Refer to Corporate and Municipal Bonds, and answer the following questions.

§  Is bond market costly to retail investors? Why?

§  List the hidden costs as a retain investors in the bond market.

§  What is Trace? Why can TRACE help to reduce the costs?

2.      Refer to www.treasurydirect.gov and answer the following questions.

What is Dutch auction. Assume you are a bidder. How can you win this auction? Refer to the auction announcement as an example.

Refer to the auction results, what is the final price? Final yield? What is high yield? Median yield? Low yield? If you are desperate for this bond, your bid should appear close to high yield or low yield? Why?

Math Formula (reference only)

C: Coupon, M: Par, \$1,000; i: Yield to maturity; n: years left to maturity

For Semi-annual, F=2 for semi-annual coupon

where:
t = period in which the
C = periodic (usually semiannual) coupon payment
y = the periodic yield to maturity or required yield
n = number periods
M = maturity value (in \$)
P = market price of bond

or,

Duration excel function syntax:

DURATION(settlement,maturity,coupon,yld,frequency,basis)

Settlement     is the security's settlement date. The security settlement date is the date after the issue date when the security is traded to the buyer

Maturity     is the security's maturity date. The maturity date is the date when the security expires.

Coupon     is the security's annual coupon rate.

Yld     is the security's annual yield.

Frequency     is the number of coupon payments per year. For annual payments, frequency = 1; for semiannual, frequency = 2; for quarterly, frequency = 4.

Basis     is the type of day count basis to use.

R*e*f*e*r*e*n*c*e   o*n*l*y

Bond risk (video)

Bond risk – credit risk (video)

# A Theory on European Bond Market Turmoil

Bond Bubble May Be Bursting Right Now! - Bud Conrad of Casey Research Interview

Week 6

Subject: Stock Valuation

Part I: Stock valuation ppt

Problem1:

3M (MMM) is expected to pay paid dividends of \$1.92 per share in the coming year.

You expect the stock price to be \$85 per share at the end of the year.

Investments with equivalent risk have an expected return of 11%.

What is the most you would pay today for 3M stock?

What dividend yield and capital gain rate would you expect at this price?

Problem2:

AT&T plans to pay \$1.44 per share in dividends in the coming year. Its equity cost of capital is 8%.Dividends are expected to grow by 4% per year in the future. Estimate the stock price of AT&T.

Part II: How to pick stocks?

FINVIZ.com

Simply the Web's Best Financial Charts

Ranking stocks using PEG ratio

Summary of stock screening rules from class discussion

PEG<1

PE<15  (? FB’s PE>100?)

Growth rate<20

ROE>10%

Zacks average =1 (from Ranking stocks using PEG ratio)

current price>5

Part III: Efficient Market Hypothesis

Paper 1 for reference:

Paper 2 for reference:

Do you see a pattern that you want to put money on?

When FED announces to decrease interest rate by 1%, then …

When FED announces to increase interest rate by 1%, then …

Types of Efficient Markets: Weak, semi-strong, strong.

The formation of a head and shoulders pattern normally begins after a nice rise in the stock share price. The left shoulder forms when there is a pull back in the price after rising to a new high or interim high. The price stops moving down after a brief drop in the price and it turns back up to a new high. The new high forms the head of the formation. Finally, the stock price turns down again before it reached the prior high forming the right shoulder.

The chart above of the DJIA or Dow Jones Industrial Average shows the formation of a well-defined head and shoulders stock pattern. In this case, two left shoulders and two right shoulders can be identified. This is fairly common and serves to further refine the head and shoulders top pattern.

Another feature of the head and shoulders stock pattern is the neckline that connects the bottom of the left and right shoulders. This neckline is offers a support level that investors use to trigger point to enter a short sale, to close long positions and/or add down side protection such as protective put options and covered calls. The neckline also helps to identify the potential drop in the price as defined by the measured move rule.

Volume is an important indicator for many head and shoulder patterns. Usually the volume is higher on the left shoulder and with the formation of the head. Then volume tends to taper off as buying interest fades. However, there are times when volume on the right shoulder can rise significantly, especially on the moves down. When this takes place, it is a further indication the price of the stock is falling and you should take action to protect their capital.

Homework

1. Pick four stocks and describe why you select the stocks.

2.                 What are the weak form, semi-strong form, and strong form of the efficient market hypotheses, respectively As a disbeliever of market efficient hypothesis, what is the evidence you have to support yourself? Refer to

Math Equations

Stock valuation

Valuing the Enterprise

*R*e*f*e*r*e*n*c*e     *O*n*l*y:

Stock screening tools

Reuters stock screener to help select stocks

FINVIZ.com

WSJ stock screen

Simply the Web's Best Financial Charts

How to pick stocks

Capital Asset Pricing Model (CAPM)Explained

Ranking stocks using PEG ratio

Summary of stock screening rules from class discussion

PEG<1

PE<15  (? FB’s PE>100?)

Growth rate<20

ROE>10%

Zacks average =1 (from Ranking stocks using PEG ratio)

current price>5

You can find analyst rating from MSN money

For instance,

ANALYSTS RATINGS

Zacks average brokerage recommendation is Moderate Buy

 RECOMMENDATIONS CURRENT 1 MONTH AGO 2 MONTHS AGO 3 MONTHS AGO Strong Buy 26 26 25 24 Moderate Buy 4 4 4 4 Hold 8 8 8 9 Moderate Sell 0 0 0 0 Strong Sell 0 0 0 0 Mean Rec. 1.51 1.51 1.53 1.58

Week 7

Subjects: Capital Structure, Dividend Policy

Chapters for reading (reference) By Berk and DeMarzo

MM Theory

1.      Who are Modigliani and Miller (MM), and what assumptions are embedded in the MM and Miller models?

2.      MM’s 1958 paper sets up the foundations for the theoretical studies in capital structure. Their paper is here.

When there is no tax

WACC     = wdrd + wcers = (D/V)rd + (S/V)rs

Conclusion:

1) The more debt the firm adds to its capital structure, the riskier the equity becomes and thus the higher its cost.

2) Although rd remains constant, rs increases with leverage.  The increase in rs is exactly sufficient to keep the WACC constant.

Conclusion:

1.         VL ≠ VU.  VL increases as debt is added to the capital structure, and the greater the debt usage, the higher the value of the firm.

2.         rsL increases with leverage at a slower rate when corporate taxes are considered.

With both corporate and personal tax added

Summary:

·         MM, No Taxes:  Capital structure is irrelevant--no impact on value or WACC.

·         MM, Corporate Taxes:  Value increases, so firms should use (almost) 100% debt financing.

·         Miller, Personal Taxes:  Value increases, but less than under MM, so again firms should use (almost) 100% debt financing.

For discussion: Do you know any company that uses 100% debt financing?

Trade off theory References: Jensen and Mekcling (1976), Jensen (1986), and Hart and Moore (1994)

There is an optimal capital structure exists that balances these costs and benefits.

At low leverage levels, tax benefits from issuing debt outweigh bankruptcy costs from debt holding.

At high levels, bankruptcy costs outweigh tax benefits.

Marginal benefit of debt declines as debt increases. There is an optimal capital structure, D/E*.

Pecking Order theory: References: Donaldson (1961), Myers (1984)

Asymmetric information exists and it is costly. Managers have more information about the quality of the firm.

Companies select financing according to the law of least effort.

(1)   Internal financing (retained earnings), first.

(2)   Bank debt (in different levels, easiest: bank debt) , second

(3)   Equity, last resort.

Myers (1984): when equity is issued, investors think firm is overvalued (managers use the last resort tool, only because firm is overvalued). Investors demand a higher return on equity than on debt.

Market Timing Theory (signaling): reference: Baker and Wrugler (2002)

Firms are indifferent between equity or debt financing. But, the market makes pricing mistakes from time to time.

Managers select the debt or equity according to the relative mispricing.

If neither market looks favorable, manager may defer issuances.

If conditions look unusually favorable, managers may raise funds even if the firm has no need for funds.

There are no firm specific variables (“factors”) that influence D/E.

Which theory is the most correct? – results are mixed

Fact 1: Firms use debt financing too conservatively – Graham (2000), Strebulaev & Yang (2007).

Fact 2: Negative relation between profitability and leverage - Myers (1993), Myers and Shyam-Sunder (1999).

Fact 3: Firms mean-revert slowly towards target leverage –Fama and French (2002), Flannery and Rangan (2006).

Fact 4: Changes in market leverage are largely explained by changes in equity prices -Welch (2004)]

Fact 5: Leverage largely driven by unexplained firm-specific fixed effect - Lemmon, Roberts, Zender (JF, 2006).

Fact 6: Link between governance mechanisms & leverage ambiguous - Berger, Ofek & Yermack (JF, 1997), John and Litov (2008)

No HW Required

Part III: Why Do Firms Pay Dividends?

Theory one: Indifference theory

n  Assuming:

No transactions costs to buy and sell securities

No flotation costs on new issues

No taxes

Perfect information

Dividend policy does not affect ke

n  Dividend policy is irrelevant. If dividends are too high, investors may use some of the funds to buy more of the firm’s stock. If dividends are too low, investors may sell off some of the stock to generate additional funds.

Theory two: bird in hand theory – High dividend can increase firm value

Dividends are less risky. Therefore, high dividend payout ratios will lower ke (reducing the cost of capital), and increase stock price

Theory three: Tax effect theory – Low dividend can increase firm value

1)      Dividends received are taxable in the current period. Taxes on capital gains, however, are deferred into the future when the stock is actually sold.

2)      The maximum tax rate on capital gains is usually lower than the tax rate on ordinary income. Therefore, low dividend payout ratios will lower ke (reducing the cost of capital), raise g, and increase stock price.

Which theory is most correct? – again, results are mixed.

1)      Some research suggests that high payout companies have high required return on stock, supporting the tax effect hypothesis.

2)      But other research using an international sample shows that in countries with poor investor protection (where agency costs are most severe), high payout companies are valued more highly than low payout companies.

Stock Repurchase:  Buying own stock back from stockholders.

Reasons for repurchases:

·         As an alternative to distributing cash as dividends.

·         To dispose of one-time cash from an asset sale.

·         To make a large capital structure change.

·         May be viewed as a negative signal (firm has poor investment opportunities).

·         IRS could impose penalties if repurchases were primarily to avoid taxes on dividends.

·         Selling stockholders may not be well informed, hence be treated unfairly.

·         Firm may have to bid up price to complete purchase, thus paying too much for its own stock.

Stock Split: Firm increases the number of shares outstanding, say 2:1.  Sends shareholders more shares.

Reasons for stock split:

·         There’s a widespread belief that the optimal price range for stocks is \$20 to \$80.

·         Stock splits can be used to keep the price in the optimal range.

·         Stock splits generally occur when management is confident, so are interpreted as positive signals.

Week 8

Final (non cumulative) and project due

Final Questions

Question 1:

The followings are APPLE, WMT, and Exxon Mobile’s payout ratio (Payout ratio = Dividend/Net income)

Explain why the three well known companies choose different dividend policies. (20 points)

 AAPL's Dividend Payout Ratio (Dec. 26, 2014) (Sep. 27. 2014) (June 27, 2014) (March 25, 2014) (Dec. 26, 2013) I. Quarter IV. Quarter III. Quarter II. Quarter I. Quarter Payout Ratio 15.69% 33.10% 36.72% 25.90% 21.25%

 2005-12 Exxon  Payout Ratio % 2006-12 20 2007-12 19.3 2008-12 18.8 2009-12 17.7 2010-12 41.6 2011-12 28 2012-12 22 2013-12 22.5 2014-12 33.4

Question 2:

Refer to the following debt equity ratio graphs of WMT, Apple, and Exxon (Debt ratio =  debt / equity) Explain why the three well known companies choose different capital structure. (20 points)

Question 3

First, explain what is bond market bubble. Fed is going to increase interest rate in the near future. Do you worry about the burst of the bond market bubble? Why or why not? (20 points, hint: this is related to interest rate risk)

Refer to this video.

Question 4

Imagine you are a stock analyst. Pick one stock only among WalMart, Apple, and Exxon Mobile and write your recommendation of  (20 points) Here are the recommendations for reference  from http://www.nasdaq.com/

(WMT recommendation)

(Exxon recommendation)

(Apple recommendation)

Question 5

What is efficient market hypothesis. What are the weak form, semi-strong form, and strong form of the efficient market hypotheses, respectively (20 points)

FINAL Questions(last semester)