CAPM involves the risk-free rate of an investment like a U.S. Treasury bond, an asset’s beta, and the expected return of the market. It is important to ensure that these values are all taken ...

“Beta” is the name for that risk sensitivity ... I follow what I call the “Upside Down CAPM” because, in practice, it appears to me that the expected total returns on equities have ...

The formula for the capital asset pricing model is: In this equation, the risk-free rate is the rate of return paid on risk-free investments such as Treasuries. Beta is a measure of risk ...