FINA 210 Lecture Notes - Lecture 3: Cash Flow, Market Segmentation, Capital Asset Pricing Model
Document Summary
The market environment is one of four environments that need to be analyzed in order to assess the investment climate and market conditions. Information about the market environment can be costly to obtain. There are a limited number of stocks and bonds. Studies show that real estate outperforms stocks and bonds. Studies show that real estate offers higher returns with no increase in risk compared with other investments. Real estate provides higher overall returns with lower variance if one does not require a high level of liquidity. The morguard index of the toronto stock exchange. The morguard index of the toronto stock exchange (tsx) indicates high returns and low risk. The morguard index uses proxy data (appraisal values) which can cause inaccuracies because it fluctuates with market conditions. The morguard index uses quarterly appraisal values to determine returns. Studies on the morguard index show annual data, making it difficult to analyze the data.
