How much to pay/sell
for a company/
Dividend discount model
Free cash flow model
The market model and multi-factor models allow us to
analyze average returns, risk, and investment strategies
Average returns: How much is alpha and how much is beta?
Risk: How much is systematic and how much is idiosyncratic?
Behavioral Finance and Limits
EMH (Efficient Market Hypothesis)
ALL investors act rationally
Prices reflect ALL available information
Some investors are not fully rational
People in standard finance are rational. Peop