can anyone explain what exactly CAPM is
CAPM is an attempt to determine the price of an asset as the name suggest (capital asset pricing model). the original idea posed by the researchers that came up with the model. The main finding was, that the model did a pretty decent job (of explaining the majority of variation in asset returns, by using the difference between the risk free rate and the market return as an explanatory factor in a 1 factor regression. Later on, new models emerged that added more factors (momentum etc.) to explain even more of the variation (Fama/French etc.)
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