Week 3 PowerPoint Presentation Prepare a PowerPoint or Prezi Presentation to define the following terms, using graphs or equations to illustrate your answers where feasible. · Risk in general;

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Week 3 PowerPoint Presentation

Prepare a PowerPoint or Prezi Presentation to define the following terms, using graphs or equations to illustrate your answers where feasible.

·         Risk in general; stand-alone risk; probability distribution and its relation to risk

·         Expected rate of return, ^r

·         Continuous probability distribution

·         Standard deviation, σ; variance, σ2

·         Risk aversion; realized rate of return, r

·         Risk premium for Stock i, RPi; market risk premium, RPM

·         Capital Asset Pricing Model (CAPM)

·         Expected return on a portfolio, r^p; market portfolio

·         Correlation as a concept; correlation coefficient, ρ

·         Market risk; diversifiable risk; relevant risk

·         Beta coefficient, b; average stock’s beta

·         Security Market Line (SML); SML equation

·         Slope of SML and its relationship to risk aversion

·         Equilibrium; Efficient Markets Hypothesis (EMH); three forms of EMH

·         Fama-French three-factor model

·         Behavioral finance; herding; anchoring