Date post: | 20-Jun-2015 |
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Business |
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2. Determinants Risk Free of CAPM TradeMarket Risk Beta Premium 3. DETERMINANTS OF CAPM Risk free MarketrateRiskPremiumBetaDETERMINATS 4. RISK FREE RATE 5. DETERMINANTS OF CAPMFree from Default Risk &Uncorrelat ed with returnsNature ofRisk FreeRate Return on Structure Zero-Beta Construction Portfolio isis costly &Best complexEstimate 6. DETERMINANTS OF CAPM 7. MARKET RISK PREMIUM 8. DETERMINANTS OF CAPM 9. DETERMINANTS OF CAPM 10. BETA 11. DETERMINANTS OF CAPM The sensitivity of a security to the movement ofthe market is measured by Beta Coefficient() Beta > 1.00 = aggressive security Beta < 1.00 = defensive security Beta of a portfolio is nothing but the weightedaverage of the betas of securities that constitutethe portfolio, the weights being the proportion ofinvestments in the respective securities. 12. THE END