Answer / rehan rao

In Modern Portfolio Theory, the Security Market Line (SML)
is the graphical representation of the Capital Asset Pricing
Model. It displays the expected rate of return for an
overall market as a function of systematic,
non-diversifiable risk (its beta).

The Y-Intercept (beta=0) of the SML is equal to the
risk-free interest rate. The slope of the SML is equal to
the Market Risk Premium and reflects investors' degree of
risk aversion at a given time.

When used in portfolio management, a single asset is plotted
against the SML using its own beta and historical rate of
return. If the plot of the asset falls above the SML it is
considered to have a good rate of return relative to its
risk (the asset is undervalued by the CAPM, and should be
acquired), and vice versa if it falls below (the asset is
overvalued, and should be sold).

what is sensex and what is nifty?

7 Answers  

---

I am attending the interview in ICICI BANK i need the interview tips and questions

0 Answers   ICICI,

---

How is control over public deposits exercised?

0 Answers  

---

What does sacp stand for?

0 Answers  

---

What bases bank will giving secured loans to sme clients?

0 Answers  

---

What is fixed assets turnover ratio? What does it indicate?

0 Answers  

---

What 'LIBOR' stands for?

0 Answers  

---

Difference between Cashflow Vs Funds Flow

5 Answers   Seaways,

---

Give key differences between BSE and NSE?

0 Answers   IBPS, RBI,

---

What is the difference between reserved capital & capital reseve?

3 Answers  

---

Name some scams that took place in recent past?

0 Answers   RBI,

---

What does the term weaker section mean?

0 Answers   State Bank Of India SBI,

---