Capital Asset Pricing Model (CAPM)

Financial Markets History

A model predicting that an investment's expected return equals the risk-free rate plus a premium proportional to its systematic risk (beta) and the equity risk premium.

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Unit 11: asset classes portfolio

Financial Markets History

Related Terms

CAPM (Capital Asset Pricing Model)

A financial model that relates an investment's expected retu...

Beta

A measure of how much an asset's price moves relative to the...

Modern Portfolio Theory (MPT)

A framework developed by Harry Markowitz for constructing in...