Capital Asset Pricing Model (CAPM)

  

A Capital Asset Pricing Model (or CAPM) is a model that prices securities in terms of the relative risk and return offered. You can do complex equations to figure the CAPM value for something (if you're into that sort of thing). The important thing to remember: CAPM recognizes that investors need to be rewarded for risk and for the value of their money in terms of time.

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