FIN 421 Investment Portfolio Management

1. Risk Factor Models are important analytical tools for investment professionals. In FIN 651 we use Risk Factor Models to address three separate needs. Describe the goal of using Risk Factor models in each of these three situations.
Answer in 5 or 6 sentences.
2. The predictive signals in the Cane Combo ranking systems were “shamelessly copied” from the academic literature. Pick one Cane Combo signal definition and briefly explain how quant investors in the real world can attempt to improve on it while using the same basic idea.
Answer in 3 or 4 sentences.