Appropriate demand of return for a share of common stock
How much more demand of return is appropriate for a share of common stock by risk-averse investors, when compared to a Treasury bill?
Expert
We are aware with the fact that the risk return relationship is positive, but the return is appropriate for a given degree of risk is quite difficult. Sadly, no one knows the answer for sure. The very well-known model used to estimate the required return rate of an investment, known its degree of risk, is the CAPM (Capital Asset Pricing Model).
We attain the following data in dollar terms: The correlation
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