From the field's leading authority, the most authoritative and
comprehensive advanced-level textbook on asset pricing
In Financial Decisions and Markets, John Campbell, one of the field's
most respected authorities, provides a broad graduate-level overview of
asset pricing. He introduces students to leading theories of portfolio
choice, their implications for asset prices, and empirical patterns of
risk and return in financial markets. Campbell emphasizes the interplay
of theory and evidence, as theorists respond to empirical puzzles by
developing models with new testable implications. The book shows how
models make predictions not only about asset prices but also about
investors' financial positions, and how they often draw on insights from
behavioral economics.
After a careful introduction to single-period models, Campbell develops
multiperiod models with time-varying discount rates, reviews the leading
approaches to consumption-based asset pricing, and integrates the study
of equities and fixed-income securities. He discusses models with
heterogeneous agents who use financial markets to share their risks, but
also may speculate against one another on the basis of different beliefs
or private information. Campbell takes a broad view of the field,
linking asset pricing to related areas, including financial
econometrics, household finance, and macroeconomics. The textbook works
in discrete time throughout, and does not require stochastic calculus.
Problems are provided at the end of each chapter to challenge students
to develop their understanding of the main issues in financial
economics.
The most comprehensive and balanced textbook on asset pricing available,
Financial Decisions and Markets is an essential resource for all
graduate students and practitioners in finance and related fields.
- Integrated treatment of asset pricing theory and empirical evidence
- Emphasis on investors' decisions
- Broad view linking the field to financial econometrics, household
finance, and macroeconomics
- Topics treated in discrete time, with no requirement for stochastic
calculus
- Solutions manual for problems available to professors
