Economics: Study Session 6
Study Session Materials
Complete List of CFA Program Readings
Topic Overview
Economic Concepts for Asset Valuation in Portfolio Management
After identifying the client’s objectives and constraints and creating an investment policy statement, the manager’s next task in the planning process is to formulate capital market expectations. These forecasts of risk and return characteristics for various asset classes form the basis for constructing portfolios that maximize expected return for given levels of risk. The first reading in Study Session 6 examines the process of setting capital market expectations and covers the major tools of economic analysis. The second reading specifically addresses the linkage between economic activity and stock market valuation.
View learning outcome statements (LOS) for reading objectives.
Complete List of CFA Program Readings
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"Capital Market Expectations" Ch. 4, Managing Investment Portfolios: A Dynamic Process, 3rd edition, John P. Calverley, Alan M, Meder, Brian D. Singer, and Renato Staub (Wiley, 2007) |
View LOS | |
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"Macroanalysis and Microevaluation of the Stock
Market" Ch. 12, Investment Analysis and Portfolio Management, 8th edition, Frank K. Reilly and Keith C. Brown (South-Western, 2006) |
View LOS |