What is the Capital Asset Pricing Model (CAPM)? What are the assumptions that underlie the model?
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Capital Asset Pricing Model
The Capital Asset Pricing Model (CAPM) describes the relationship between systematic risk and expected return for assets, particularly stocks. The CAPM is a model for pricing an individual security or portfolio. For individual securities, we make use of the security market line (SML) and its...
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The Capital Asset Pricing Model CAPM is an equilibrium model which specifies the relationship betwee...View the full answer
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