Arbitrage Pricing Theory (APT)

Business / Finance / Arbitrage Pricing Theory (APT): An alternative model to the capital asset pricing model developed by Stephen Ross and based purely on arbitrage arguments. The APT implies that there are multiple risk factors that need to be taken into account when calculating risk-adjusted performance or alpha.

Preferred Habitat Theory

Business / Finance / Preferred Habitat Theory: A biased expectations theory that believes the term structure reflects the expectation of the future path of interest rates as well as risk premium. The theory rejects the assertion that the risk prem MORE

Presidential Election Cycle Theory

Business / Finance / Presidential Election Cycle Theory: A theory that stock market trends can be predicted and explained by the four-year presidential election cycle. MORE

Organizational Behavior Modification Theory

Business / Human Resources (HR) / Organizational Behavior Modification Theory: A motivational theory suggesting that an individual will behave in a manner that helps him or her avoid potential negative outcomes and achieve agreeable outcomes. MORE

Optimal Foraging Theory

Science / Marine Biology / Optimal Foraging Theory: A theory designed to predict the foraging behavior that maximizes food intake per unit time MORE

Odd-Lot Theory

Business / Finance / Odd-Lot Theory: The theory that profits can be made by making trades contrary to odd-lot trading patterns, since odd-lot investors have poor timing. This theory is no longer popular. MORE

Pricing Efficiency

Business / Finance / Pricing Efficiency: Also called external efficiency; a market characteristic that prices at all times fully reflect all available information that is relevant to the valuation of securities. MORE

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