Results for “Beta”
2 terms
Capital Asset Pricing Model
Fundamental Analysis & Valuation
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A model that estimates the return required on an asset as the risk-free rate plus a premium proportional to its market risk.
Expected Return = Risk-Free Rate + Beta x (Expected Market Return - Risk-Free Rate)
Cost of Equity
Fundamental Analysis & Valuation
%
The return shareholders require for bearing the risk of owning a company's shares.
Cost of Equity = Risk-Free Rate + Beta x Equity Risk Premium