The assignment that I have is read two cases and answer the related questions below. The cases have the copyright, so I can get you them when you decided to work on it. Thank you.
CAPM Questions:
What are the three inputs that are required by the CAPM to come up with an estimate for the Expected Return of a stock? What does the article suggest are the most widely used methods, in practice, for coming up with these inputs to the model?
DFA Questions:
Why did DFA decide to start a small cap fund? How do their small cap funds differ from a typical actively managed small cap fund? How do their small cap funds differ from a typical small cap index fund?
Why did DFA decide to start their different value funds? What are some alternative ways to define “value stocks”?
What is adverse selection?
In what way can you describe DFA as being a believer in the Efficient Market Hypothesis? In what way can you describe them as not believing in efficient markets?
