CAPM, Risk-Free Rates, and Market Premia

CAPM and premium pages explain how analysts estimate required returns from systematic risk and market compensation.

This subsection keeps model-based return inputs separate from generic quoted or annualized rates.

In this section

• Capital Asset Pricing Model
  Learn what the capital asset pricing model is, how it links expected return to systematic risk, and why beta matters in equity valuation.
• Market Risk Premium: The Extra Return Investors Demand for Bearing Market Risk
  Learn what the market risk premium is, how it is used in CAPM and valuation, and why it matters for required return.
• Risk-Free Rate: The Baseline Return Used Across Finance
  Learn what the risk-free rate means, why Treasury yields are often used as a proxy, and how the rate affects valuation, portfolio theory, and discount rates.