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Basic Question 5 of 5
The security characteristic line is ______.
B. the SML
C. used to derive the systematic risk of an asset
D. the typical Markowitz efficient frontier
A. used to derive the total risk of an asset
B. the SML
C. used to derive the systematic risk of an asset
D. the typical Markowitz efficient frontier
User Contributed Comments 2
| User | Comment |
|---|---|
| danlan | It's not the SML. Its slope is beta, while in SML, beta is the independant variable. |
| thekapila | its a regression method. which is mathematically = y = mx +c here for SML.we have rf + B(Rm - rf) representig the line which can beused to derive B |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
describe and demonstrate applications of the CAPM and the SML
CFA® 2024 Level I Curriculum, Volume 2, Module 2.