Skip to content
Journal article

Yes, The APT Is Testable

DYBVIG P, ROSS S ...see all

The Journal of Finance, vol. 40, issue 4 (1985) pp. 1173-1188

  • 48

    Readers

    Mendeley users who have this article in their library.
  • 54

    Citations

    Citations of this article.
  • N/A

    Views

    ScienceDirect users who have downloaded this article.
Sign in to save reference

Abstract

The Arbitrage Pricing Theory (APT) has been proposed as an alternative to the mean-variance Capital Asset Pricing Model (CAPM). This paper considers the testability of the APT and points out the irrelevance for testing of the approximation error. We refute Shanken's objections, including his assertion that Roll's critique of the CAPM is applicable to the APT. We also explain the testability of the APT on subsets, and we explore the relationship between the APT and the CAPM. [ABSTRACT FROM AUTHOR]

Get free article suggestions today

Mendeley saves you time finding and organizing research

Sign up here
Already have an account ?Sign in

Find this document

Get full text

Authors

  • PHILIP H. DYBVIG

  • STEPHEN A. ROSS

Cite this document

Choose a citation style from the tabs below