Reviewed by Thomas Brock Fact checked by Suzanne Kvilhaug CAPM: An Overview Many investors use the capital asset pricing model (CAPM) as a way to estimate the potential return of a stock or other ...

The traditional formula for the cost of equity is the dividend capitalization model and the capital asset pricing model (CAPM). The cost of equity is the return that a company requires for an ...

The Capital Asset Pricing Model (CAPM) is a simple heuristic for thinking about market returns. Basically, the idea is that the main risk that you can’t diversify away from is collective ...

Black, Fischer, Michael C. Jensen, and Myron Scholes. "The Capital Asset Pricing Model: Some Empirical Tests." In Studies in the Theory of Capital Markets, edited by ...