Interview with Kenneth French

Kenneth R. French is the NTU of Professor of Finance at the MIT Sloan School of Management. He is an expert on the behavior of security prices, investment strategies, and the management of financial risk. His recent research focuses on tests of asset pricing models, the trade up between risk and return in domestic and international financial markets, the cost of capital and the relation … [ Read more ]

Disagreement, Tastes, and Asset Prices

Confused about the differing assumptions of pricing models? More than likely you know that the assumptions don’t hold very well and you probably know much research has looked at how the assumptions matter. Fama and French now provide a framework to hopefully make sense of some of this confusion. In a working paper they show that investor tastes and expectations matter. For … [ Read more ]

The Capital Asset Pricing Model: Theory and Evidence

I love summary articles. They help make sense of the world and let us see the forest through the trees. Some of my favorites include the Harris and Raviv summary article on capital structure, Fama’s paper that responds to Behavioral Finance Theories, and Cliff Smith’s introduction to his book of readings in Corporate Finance. And now I have a favorite on the … [ Read more ]