The Expected Rate of Return (E(R)) is the average return an investor anticipates receiving on an investment, considering all possible returns and the probability of each return occurring. It's essentially a probability-weighted average of all potential outcomes
Posts tagged as “Risk Premium”
The Capital Asset Pricing Model (CAPM), developed in the 1960s by William Sharpe, John Lintner, and Jan Mossin, provides a framework to evaluate the expected return of an investment relative to its risk.