Client Investment Recommendations and Strategies

Question 1

Capital Asset Pricing Model (CAPM)

Answer 1

Describes the relationship between systematic risk and expected return for assets, particularly stocks. CAPM is widely used throughout finance for pricing risky securities and generating expected returns for assets given the risk of those assets and cost of capital.

Question 2

capital loss

Answer 2

The loss incurred when a capital asset is sold for a price lower than the purchase price.