Finance Exam

How much better or worse an investment has performed compared to its expectations based off risk

A measure of a stock volatility in relation to the overall market

Financial Model that describes the relationship between systematic risk and expected returns for assets

Proportions of debt, equity, and other sources of financing that are used by a company to fund operations and investments

Cost associated with each source of funding used by a company

Cost a company incurs to raise funds through borrowing

Return investors expect in exchange for its risk

The amount a company pays out in dividens after a year

Process of risk management that involves spreading investments across different assets or types of investments

Method used to value a stock by estimating its instrinsic value based on expected future dividends

Cost of financing for a specefic division or segment within a company

A market in which all relevent information is quickly and fully reflected in asset prices

Additional Return investors expect to receive for holding a risky asset

Collection of financial assets

Anticipated rate of return that an investor expects from a portfolio of investments

How much weight or the proportion of an asset's value relative to the totality of the portfolio

Method used to estimate cost of capital or value a specefic business segment or project

Graph that shows relationship between expected returns and systematic risk

Risk associated with individual assets or investments within a portfolio

Risk specefic to an individual asset

Inherent risk that affects an entire market/portfolio

Average rate a firm pays to finance its assets