Question: 1. Why the three step top down security analysis approach is used in investment decision process? explain 2. explain stock valuation techniques 3. Explain why

1. Why the three step top down security analysis approach is used in investment decision process? explain

2. explain stock valuation techniques

3. Explain why most investors prefer to hold a diversified portfolio of securities as opposed to placing all of their wealth in a single asset.

4. In terms of the Markowitz portfolio model, explain how an investor identifies his / her optimal portfolio. What specific information does an investor need to identify optimal portfolio?

5. How many portfolios are on an efficient frontier? How is an investor's risk aversion indicated in an indifference curve?

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