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Investing Glossary:
Common factor
Copyright 2009,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Definition: |
| An element of Return that influences many assets. According to multiple Factor risk models, the common factors determine correlations between Asset returns. Common factors include Size (often measured by Market capitalization), Valuation measures such as price to Book value Ratio and Dividend yield, industries and Risk indices.
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