Briefly explain three risk exposures that an analyst should report as part of an enterprise risk management system

Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter11: Risk-adjusted Expected Rates Of Return And The Dividends Valuation Approach
Section: Chapter Questions
Problem 3QE
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A. Briefly explain three risk exposures that an analyst should report as part of an
enterprise risk management system
B. Define market risk and the economic parameters considered when calculating
market risk.
C. Explain the concept of ‘beta’ within the framework of the Capital Asset Pricing
Model
(CAPM). Discuss the relevance of the covariance between assets returns
for an investor wishing to diversify the risk of a portfolio

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