capital asset pricing model (CAPM)

Definition

One of the two leading capital market theories of 1960s and 1970s, it is based on the idea of risk aversion. It states (1) whatever the rate of return on an investment, it should be achieved with the lowest possible level of risk, and (2) a high-level of risk should be accompanied by a correspondingly high-level of return. CAPM (like its contemporary theory, arbitrage pricing theory or APT) works only in a market in equilibrium and makes other restrictive assumptions such as equal access to information, no information or transaction costs, and rational investors. See also capital market theories. See also dividend capitalization model.

单词	capital asset pricing model (CAPM)
释义	capital asset pricing model (CAPM) Definition One of the two leading capital market theories of 1960s and 1970s, it is based on the idea of risk aversion. It states (1) whatever the rate of return on an investment, it should be achieved with the lowest possible level of risk, and (2) a high-level of risk should be accompanied by a correspondingly high-level of return. CAPM (like its contemporary theory, arbitrage pricing theory or APT) works only in a market in equilibrium and makes other restrictive assumptions such as equal access to information, no information or transaction costs, and rational investors. See also capital market theories. See also dividend capitalization model.
随便看	out of the box thinking out-of-the-money option outpatient outperform outplacement outplant output output contract output device output effect output gap output measure output standard output tax outsourcing outstanding outstanding check outstanding debt outstanding deposit outstanding premiums outstanding shares outturn outward collection outward credit overabsorption