Two Assumptions Investors forecasts agree with respect to expectations,standard deviations,and correlations of the returns of risky securities. Therefore all investors hold risky assets in the same relative proportions Investors behave optimally In equilibrium,prices adjust so that aggregate demand for each security is equal to its supply THE COURSE OF FINANCE 2017 SPRING SJTU 6Two Assumptions  Investors forecasts agree with respect to expectations, standard deviations, and correlations of the returns of risky securities. Therefore all investors hold risky assets in the same relative proportions  Investors behave optimally :In equilibrium, prices adjust so that aggregate demand for each security is equal to its supply THE COURSE OF FINANCE 2017 SPRING SJTU 6