These physical risks can lead to direct ... This is known as transition risks. For example, new regulations and carbon-pricing schemes could make carbon-intensive infrastructure assets less ...

Examples of diversifiable, non-systematic risks include: It can become complex and cumbersome to measure how diversified a portfolio is. In reality, it is impossible to calculate the actual degree ...

Arbitrage pricing theory ... always construct a portfolio with factor sensitivities similar to those of mispriced securities and exploit the arbitrage opportunity. For example, suppose that ...