Abstract

This paper aims to examine the financial risks faced by Chinese airline companies and provide useful information to investors who are interested in investing in these firms. The study will conduct valuations on the three largest airline companies in China, namely China Southern Airlines, Air China, and China Eastern Airlines, and assess the differences in the financial risks taken by these companies. The methodology used will be the Capital Asset Pricing Model (CAPM) and the metric of beta, which is used to assess the volatility of a stock or portfolio compared to the entire market. The paper provides a literature review of related research on the use of beta, risk factor models, and other financial measures to evaluate the performance and risk profile of firms in various industries. The study aims to contribute to the existing knowledge of the financial risks of airline companies and their potential impact on investor decisions.

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