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Risk-Free Rate
The risk-free rate is the theoretical rate of return of an investment with zero risk, often represented by the yield of a short-term government bond.
Beta
A measure of a stock's volatility in relation to the overall market, used in the Capital Asset Pricing Model to determine the expected return of an investment.
Risk Aversion
The reluctance of a person to accept a bargain with an uncertain payoff rather than another bargain with a more certain, but possibly lower, payoff.
High-Beta Stocks
Stocks with a beta value higher than 1, indicating they are more volatile than the overall market and potentially offering higher returns.
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