smartpants

the fact that a firm is not widely covered might also mean investors require an additional premium for investing in those types of stocks and that the excess return is just that. this is in favor of efficient markets. it means that our models for calculating expected return(CAPM, fama and french multi-factor CAPM) are not doing a good job at explaining risk/return



Edited 1 time(s). Last edit at Tuesday, September 1, 2009 at 11:15AM by Ako.