Ch 2 · Security Analysis & Portfolio Management

5 concept points · 4 formulas · 4 exam-critical points.

📘 Core concepts

• 1Fundamental analysis: EIC framework (Economy → Industry → Company).
• 2Technical analysis: charts, trends, momentum indicators, support/resistance.
• 3EMH: weak (past prices reflected), semi-strong (public info), strong (all info incl. insider).
• 4Markowitz portfolio theory: diversification reduces unsystematic risk.
• 5CAPM: only systematic risk (β) priced; SML: E(Ri) = Rf + βi(Rm − Rf).