25, 389-390 Expected active return, 303 Expected returns: Black-Litterman global asset allocation model, 77-86 Capital Asset Pricing Model fCAPM), 36 covariance matrix estimation, 226 credit risk and, 268 global equilibrium, 56-75 market portfolio construction, 100-101 modern portfolio theory (MPT), 12-13,16-20,23 risk budget, 255-256 uncorrelated assets, 161-168 Exposure matrix, 346, 393 Factor loadings, 338-339 Factor-mimicking portfolios (FMPs), 340,359-361 Factor model, return attribution: contributions to returns, 331 global, 321-322 implications of, 247 linear, 303,309,311-319 Factor returns: contributions, 301, 304, 306 covariance matrix forecasts, 362-363 equity risk factor models, 338-341, 347 estimating, 356-359 global, 367 Fair value, 288-289, 294-296 Fama, Eugene, 45, 53, 344 Federal Reserve, 552 Fed model, 464 Feedback, indirect, 222-223 Fiduciaries, 408 Financial accounting controls, 252, 277 Financial budgets, 252, 257, 277 Financial institutions, risk management strategies, 28-29, 249 Financial planning, 277 Financial risk management, 28-29 Financial statements, 417 Financial theory, 4 Financial Times Stock Exchange (FTSE), All World indexes, 91-92 Fiscal policy, 436 Fixed income arbitrage, 490, 494-495 Fixed income market, 74, 78 Fixed income portfolios: active management strategies, 444-451 benchmarks, 442-444 risk budgeting, 446-451 risk sources, 435-442 Fixed-income securities, 99, 104-105, 130,145,555 Forecasting: equity portfolio management (EPM), 417,419-426 factor model framework, 378 global tactical asset allocation (GTAA), 461-467 models, 76-78, 226-227, 262, 264-266, 273 returns, 417, 420^22 risks, 417, 422^23 transaction costs, 423-425 Foreign bond portfolios, 140-142 Foreign exchange (FX), currency hedging, 145 Foreign exchange hedge, 60 Foreign exchange market, 349 Foreign exchange rates, 292. See also Exchange rates Foreign market changes, 30 Forward contracts, 60, 319, 325, 468, 470,472 Forward premium, 320, 322, 325 Foundation, 566, 569-570, 575-578, 590 401 (k) plan, 543, 567, 575 Fouse, William, 456 Frank Russell Company, 313 Free float, 92, 94, 98 French, Kenneth, 45, 53, 344 Frictions, 52 FRM/MSCI, 487 FTSE 300, 92