The Capital Asset Pricing Model (CAPM)
Lecture no. 17 from the course: Advanced Investments
Taught by Professor Steve L. Slezak | 32 min | Categories: The Great Courses Plus Online Economics & Finance Courses
Study the characteristics of an equilibrium asset pricing model. Then build the most popular version—the capital asset pricing model (CAPM)—which allows you to measure risk for a portfolio. According to CAPM, the cross- section of returns is driven by common risks that cannot be eliminated through diversification.