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In this chapter, the book compares the index model (whereby assets are compared to a single index vs the Markowitz model that uses the covariances with all other assets with all other assets. It also discusses how bets are calculated and what adjusted betas represent.
By jim maharIn this chapter, the book compares the index model (whereby assets are compared to a single index vs the Markowitz model that uses the covariances with all other assets with all other assets. It also discusses how bets are calculated and what adjusted betas represent.