A security held in a large, well-diversified portfolio that has a beta of zero in a one-factor model will have an actual return:
closely equal to the expected return
of zero.
closely equal to the market risk premium.
that is positive and less than the risk-free rate.
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
(Save $1 )
One time Pay
(Save $5 )
Billed Monthly
*First month only
You can see the logs in the Dashboard.