文档介绍：Irwin/McGraw-Hill
Chapter 12
Fundamentals of Corporate Finance
Third Edition
Corporate Financing and the Lessons of Market Efficiency
Brealey Myers Marcus
slides by Matthew Will
Irwin/McGraw-Hill
The McGraw-panies, Inc.,2001
Topics Covered
Investment Decision vs. Financing Decision
Market Efficiency
Weak form efficiency
Semi-strong form efficiency
Strong form efficiency
Lessons of Market Efficiency
Investment vs. Financing
Investment decision are made based on the risk of the project, with total disregard for how the project will be financed (flotation costs being the exception).
Financing decisions are made based on the conditions in the capital markets, with little consideration for the investment being made (project specific funding being the exception. IRBs are a good example).
Market Efficiency Theory
Capital markets reflect all relevant information. You cannot consistently earn excess profits.
Market Efficiency
Market Efficiency
Efficient Capital Markets - Financial markets in which security prices rapidly reflect all relevant information about asset values.
Random Walk - Security prices change randomly, with no predictable trends or patterns.
Random Walk Theory
The movement of stock prices from day to day DO NOT reflect any pattern.
Statistically speaking, the movement of stock prices is random (skewed positive over the long term).
Random Walk Theory
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Coin Toss Game
Heads
Heads
Heads
Tails
Tails
Tails
Random Walk Theory
Market Efficiency
Technical Analysts - Investors who attempt to identify over- or undervalued stocks by searching for patterns in past prices.
Fundamental Analysts - Analysts who attempt to fund under- or overvalued securities by analyzing fundamental information, such as earnings, asset values, and business prospects.