The assumptions of CAPM Implicit means behind the assumptions Efficient market k Everyone has the same information and agrees about the future prospects for assets Perfect market < There are on frictions to impede investing Equilibrium market k Risk-return trade-offThe Assumptions of CAPM • Implicit means behind the assumptions – Efficient Market «Everyone has the same information and agrees about the future prospects for assets – Perfect Market «There are on frictions to impede investing – Equilibrium Market «Risk-return trade-off