Page 24 - CAPE Financial Services Syllabus Macmillan_Neat
P. 24
UNIT 1
MODULE 2: PORTFOLIO MANAGEMENT AND INVESTMENT (cont’d)
SPECIFIC OBJECTIVES CONTENT
Students should be able to:
(f) All investors have the same probability
15. explain the relationship among for outcomes.
systematic risk, unsystematic risk,
and diversification; (g) No inflation exists.
16. explain the capital market theory; (h) There is no mispricing within the
capital markets.
17. analyse pricing models and
theories; The difference between systematic and
unsystematic risk.
How these concepts relate to diversification.
(a) Capital market theory assumptions.
(b) Similarities and differences between
the Security Market Line (SML) and
Capital Market Line (CML).
(c) How the Security Market Line (SML) is
used to evaluate whether securities
are properly priced.
(a) The Capital Asset Pricing Model
(CAPM);
(b) The deficiencies of the Capital Asset
Pricing Model (CAPM);
(c) The Arbitrage Pricing Theory (APT);
(d) Similarities and differences between
Arbitrage Pricing Theory (APT) and
Capital Asset Pricing Model (CAPM);
and,
(e) Strengths and weaknesses of the
Arbitrage Pricing Theory (APT).
CXC A38/U2/16 19
