Proceedings of the 2012 National Conference on Information Technology and Computer Science

Applicability Evaluation to Capital Asset Pricing Model

Authors
Xinzhu Li
Corresponding Author
Xinzhu Li
Available Online November 2012.
DOI
https://doi.org/10.2991/citcs.2012.4How to use a DOI?
Keywords
Capital Asset Pricing Model (CAPM); investment portfolio; theoretical limitations; applicability evaluation
Abstract
The Capital Asset Pricing Model (CAPM), proposed by Professor William. F. Sharpe, a Nobel Prize winner in economics, is considered to be the backbone of pricing theory in modern financial market. The model is simple and practical, and mainly adopted in researches on the relationship between the expected rate of assets return and the assets investment risk, as well as the formation mechanism of equilibrium price. The Capital Asset Pricing Theory is not fully applicable to a variety of abnormalities in financial markets and the special circumstances of China's security market due to its strict assumptions and limitations in practical application. However, with the gradual improvement of China's security market, CAPM theory, by appropriate modification, will play a major role in technical analysis thereon.
Open Access
This is an open access article distributed under the CC BY-NC license.

Download article (PDF)

Proceedings
2012 National Conference on Information Technology and Computer Science
Part of series
Advances in Intelligent Systems Research
Publication Date
November 2012
ISBN
978-94-91216-39-8
ISSN
1951-6851
DOI
https://doi.org/10.2991/citcs.2012.4How to use a DOI?
Open Access
This is an open access article distributed under the CC BY-NC license.

Cite this article

TY  - CONF
AU  - Xinzhu Li
PY  - 2012/11
DA  - 2012/11
TI  - Applicability Evaluation to Capital Asset Pricing Model
BT  - 2012 National Conference on Information Technology and Computer Science
PB  - Atlantis Press
SP  - 11
EP  - 14
SN  - 1951-6851
UR  - https://doi.org/10.2991/citcs.2012.4
DO  - https://doi.org/10.2991/citcs.2012.4
ID  - Li2012/11
ER  -