Utility: related pages

A branch of financial economics that models the behaviour of investors, rather than simply assuming that they are rational and risk averse.

The theorem that investment decisions by firms need not be linked to consumption decisions by individual investors.

A model of the factors (such as quality) that affect prices, so price indices can be adjusted for changes in these factors.

A graph of the relationship between utility an individuals consumption of something.

The difference between the rate of return on a security (or a market or an investment) and the risk free rate of return.

The preference of investors for the less risky of investments with identical expected returns.