Our Capacity to Anticipate What Comes Next and Then to Devise

question 21

True/False

Our capacity to anticipate what comes next and then to devise ways to affect the outcomes of events and processes is absolutely fundamental to our survival as a species and to our current planetary dominance. We look for cause-and-effect relationships to explain, and hence to predict and control.

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Definitions:

Beta Coefficient

An indicator of how much a stock's price fluctuates in comparison to the general market, representing its risk relative to the market norm.

Treynor-Black Model

A portfolio optimization model that blends passive and active management strategies to try to achieve excess returns with an acceptable level of risk.

Alpha Coefficient

A measure of the performance on a risk-adjusted basis of an investment portfolio, indicating excess return over the benchmark.

Beta Coefficient

A measure of the volatility, or systematic risk, of a security or a portfolio compared to the market as a whole.