Capital Asset Pricing Model
Estimate a required return from market beta and a risk premium.
Your numbers
Model required return
Educational estimate using your assumptions; no live rates, tax rules or investment recommendations. Returns can be negative and are not guaranteed.
Scenario comparison
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Formula
E[R]=Rf+β(E[Rm]−Rf)
Estimate a required return from market beta and a risk premium.
Worked example
- Risk-free rate (%)
- 3
- Expected market return (%)
- 8
- Market beta
- 1.2
- Model required return
- 9 %
- Market risk premium
- 5 percentage points
Scope and limitations
Educational estimate using your assumptions; no live rates, tax rules or investment recommendations. Returns can be negative and are not guaranteed.
Inputs are checked for missing values and allowed ranges. A result outside the finite numeric range is not displayed. Rounding affects display, while the calculation uses the model’s numeric precision.
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Formula version: 48215307fa8b · Example checked: