3.8 CAPM: The Capital Asset Pricing Model (CAPM) is a financial model that assumes returns on a portfolio are normally d

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3 8 Capm The Capital Asset Pricing Model Capm Is A Financial Model That Assumes Returns On A Portfolio Are Normally D 1 (22.18 KiB) Viewed 16 times

3.8 CAPM: The Capital Asset Pricing Model (CAPM) is a financial model that assumes returns on a portfolio are normally distributed. Suppose a portfolio has an average annual return of 14.7% (1.e. an average gain of 14.7%) with a standard deviation of 32.9%. A return of 0% means the value of the portfolio doesn't change, a negative return means that the portfolio loses money, and a positive return means that the portfolio gaine money. (Keep one decimal place.) a) What percent of years does this portfolio lose money, 1.e. have a return less than OX? b) What is the cute for the highest 15% of annual returns with this portfolio? Submit All Parts →