Security Market Line: Difference between revisions
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imported>Doug Williamson m (Spacing.) |
imported>Doug Williamson m (Punctuation.) |
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== See also == | == See also == | ||
[[Capital Market Line]] | *[[Capital Market Line]] | ||
Revision as of 16:58, 24 August 2013
(SML).
The Security Market Line is a graphical presentation of the Capital asset pricing model formula:
Ke = Rf + beta x [Rm-Rf]
Where:
Ke = cost of equity.
Rf = theoretical risk free rate of return.
Beta = relative market risk.
Rm = average expected rate of return on the market.
