I have never seen a topic one used to consider mysterious rendered so powerless and elementary. Prof, the lecture is crytstal clear and the delivery excellent!
Is it true that if the B=0.8 then it means that it鈥檚 20% less Risky then the Market, So the Premium we want will be 20% less then the Market(i.e 8%) that鈥檚 why in Example No.2 we Subtract 20% then the Market Premium(i.e 8%) Ex= 20% of 8 is 1.6 8-1.6=6.4 The Premium we want will be 6.4%
I think he got the 10% from the answers to the examples in the notes where it states df @ 10%… PV @ 10%… Whilst it is clear that you have not used these, they confused me also. Can you confirm that this is an error? Many thanks,
I know you’ve shown us how to calculate Beta and you said that the examiner is not likely to ask us to calculate Beta but I was told by my workplace mentor that if beta is not given, then make a note to the examiner that I am assuming Beta is 1 and continue as such… Will this cost me any marks?
You will either be given beta, or you will be asked to find beta by using the formula backwards (although this is not so likely). You certainly will not be asked to calculate beta from other information – that is not in the syllabus for F9.
However – and this applies to all questions – if for any reason you cannot find a figure you need (probably because it is always harder in the exam with time pressure and panicking) then do invent a figure so you can still prove that you know what to do with it. You will lose marks, but nowhere near as many marks as you would have lost if you just gave up on the question.
sir, although i am demanding a lot but i know you are generous enough to cope with it…ECONOMIC ENVIRONMENT is a tough theory, If you can assist us by throwing a lecture…PLEASE its a humble request….
it’s always lovely listening to you sir, so you don’t have to feel guilty about your chat. and in fact it keeps me wide awake 馃槢 lots of sincere wishes for you, thanks a lot for your wonderful and generous services.
I completely agree! – I was going to comment the same thing! Mr John always says sorry, I have to talk! I find it amusing when he discusses things, he removes my doubts and makes things clearer.
i find these series very helpful to my success in f9. i am sure any body can pass with it. now am studying p4, i have go over it another time to solidify my basis. thanks to the entire team of opentuition
This is beyond any human imagination, Indeed a revelation. You absolutely break the concepts like an Angel Joe. You are indeed a supernormal and exceptional blessing to us John. May the Almighty God add his abnormal blessings upon you- Great John.
suf23 says
OpenTuition Zindabad(long live)! 馃檪
John Moffat says
Thank you 馃檪
eadinnu says
I have never seen a topic one used to consider mysterious rendered so powerless and elementary. Prof, the lecture is crytstal clear and the delivery excellent!
John Moffat says
Thank you 馃檪
mansoor says
watching ur lectures is like watching a classic david lean movie: the delivery and the message of the dialogue is, simply put, terrific!
John Moffat says
Thank you 馃檪
osmanuaepak@yahoo.com says
Is it true that if the B=0.8 then it means that it鈥檚 20% less Risky then the Market, So the Premium we want will be 20% less then the Market(i.e 8%) that鈥檚 why in Example No.2 we Subtract 20% then the Market Premium(i.e 8%)
Ex= 20% of 8 is 1.6
8-1.6=6.4
The Premium we want will be 6.4%
John Moffat says
Yes – that is what I say in the lecture and what we arrive at using the formula 馃檪
aliimranacca007 says
if beta= 2 it means that investemnt is 2 time more risky than the market value is it right ?
John Moffat says
It is two times as risky as the market i.e. the stock exchange as a whole.
liew says
Hi, May I know for chapter 20 Example 4 why must 1/0.13 not 0.13 at df@10% there ?
John Moffat says
Firstly the required return is 6% + 1.4 x (11% – 6%) = 13%. (I don’t know where you have got 10% from).
Secondly, since we are discounting a perpetuity, the discount factor is 1/r. So in this case we multiply by 1/0.13
(If you are unsure about perpetuities then watch the earlier lecture on investment appraisal methods)
liew says
Thanks
liew says
Thanks.
skybluedar says
I think he got the 10% from the answers to the examples in the notes where it states df @ 10%… PV @ 10%… Whilst it is clear that you have not used these, they confused me also. Can you confirm that this is an error? Many thanks,
John Moffat says
Yes – it is just a typing error. I will have it corrected.
The workings are correct, and more importantly the lecture working through the example is correct.
fzinyemba says
Thank you for the lecture..F9 here i come..im ready, thanks to open tuition
sonria says
I know you’ve shown us how to calculate Beta and you said that the examiner is not likely to ask us to calculate Beta but I was told by my workplace mentor that if beta is not given, then make a note to the examiner that I am assuming Beta is 1 and continue as such… Will this cost me any marks?
John Moffat says
You will either be given beta, or you will be asked to find beta by using the formula backwards (although this is not so likely).
You certainly will not be asked to calculate beta from other information – that is not in the syllabus for F9.
However – and this applies to all questions – if for any reason you cannot find a figure you need (probably because it is always harder in the exam with time pressure and panicking) then do invent a figure so you can still prove that you know what to do with it.
You will lose marks, but nowhere near as many marks as you would have lost if you just gave up on the question.
sonria says
Awesome, thanks
starry says
Thank you for helping, through your humble yet formidable teachings, a slow learner like me is seeing hope
Zohaib says
sir, although i am demanding a lot but i know you are generous enough to cope with it…ECONOMIC ENVIRONMENT is a tough theory, If you can assist us by throwing a lecture…PLEASE its a humble request….
marvibhatti says
it’s always lovely listening to you sir, so you don’t have to feel guilty about your chat. and in fact it keeps me wide awake 馃槢
lots of sincere wishes for you, thanks a lot for your wonderful and generous services.
John Moffat says
Thank you 馃檪
Mahoysam says
I completely agree! – I was going to comment the same thing! Mr John always says sorry, I have to talk! I find it amusing when he discusses things, he removes my doubts and makes things clearer.
Ken says
It was a great class…thank you
keep up the good work
aduuni says
Thank you so much for these lecture, you have made it more simplier for me to understand. Thank you Open Tuition
simeonchuks says
i find these series very helpful to my success in f9. i am sure any body can pass with it. now am studying p4, i have go over it another time to solidify my basis.
thanks to the entire team of opentuition
rssd says
Great, very well explained.. God bless u..
zwelim says
This is beyond any human imagination, Indeed a revelation. You absolutely break the concepts like an Angel Joe. You are indeed a supernormal and exceptional blessing to us John. May the Almighty God add his abnormal blessings upon you- Great John.
jibran89 says
there is no one i suppose more and mere better than you.. love the way you engaged us through out the lecture….. 馃檪
Ammar-Shabbir says
Pure Geniuiness……
Saad Bin Aziz says
CAPM is the most difficult f9 topic in the studytext for me…and now after viewing this lecture, its a piece of cake:-) thank you again john!
Arsal says
awsum work done thanksyou for this work
funlover says
What can I say- Absolute classic!