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Can the following patterns of the value offect be explained by the CAPM model? The left panel provides the average returns of stock portfolios sorted

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Can the following patterns of the value offect be explained by the CAPM model? The left panel provides the average returns of stock portfolios sorted by book-to market ratios. The right panel provides the market betas of the stock portfolios. Woont unet Ports 1963-2001 No. No, CAPM cannot explain the above patters Yes, the patterns are consistent with market efficiency in the CAPM world

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