This is the leading textbook for the graduate/MBA investments market. Its unifying theme is that security markets are nearly efficient, meaning that most securities are usually priced appropriately given their risk and return attributes. The text places greater emphasis on asset allocation, and offers a much broader and deeper treatment of futures, options, and other derivative security markets than most investment texts.
New Features:
•End of chapter problem sets are separated by level of difficulty: quiz, problems, and challenge problems.
•New Hedge Funds Topics.
•Optimal Risky Portfolios: additional material on the “art” of selecting reasonable parameter values for portfolio construction, and a discussion of what can go wrong when inputs are derived solely from recent historical experience.
•Empirical Evidence on Security Returns: new material on the interpretation of risk premiums.
•Bond Prices and Yields: new material explaining collateralized debt obligations (CDOs) as well as the role of credit rating agencies in the recent credit market crisis.
