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Factor completely.
CAPM
Capital Asset Pricing Model; a model that describes the relationship between risk and expected return and that is used in the pricing of risky securities.
Arbitrage Pricing Theory
A financial model that estimates the price of securities by considering the relationship between their expected returns and macroeconomic factors.
Single Market Index
An index that measures the performance of a specific market segment or region.
Nonsystematic Risk
This type of risk is unique to a specific company or industry and can be reduced through diversification.
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