Security Market Line: Difference between revisions
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imported>Doug Williamson m (Amend Ke to Re.) |
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*[[Capital Market Line]] | *[[Capital Market Line]] | ||
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Revision as of 19:25, 9 November 2013
(SML).
The Security Market Line is a graphical presentation of the Capital asset pricing model formula:
Re = Rf + beta x [Rm-Rf]
Where:
Re = return on security.
Rf = theoretical risk free rate of return.
Beta = relative market risk.
Rm = average expected rate of return on the market.
