Examlex
One variable that the security market line approach depends on to estimate the expected return on a risky asset is the Market risk premium.
Treynor Measure
A performance metric for determining how much excess return was generated for each unit of risk taken by a portfolio.
Beta
A measure of a stock's volatility in relation to the overall market; indicates the stock's risk compared to that of the average market portfolio.
Jensen's Measure
A metric used to evaluate the performance of an investment portfolio, considering both the risk-adjusted return and the portfolio's expected return based on market risk.
Market Portfolio
A theoretical bundle of investments that represents a segment of the overall market, typically used in the Capital Asset Pricing Model.
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