{"id":842,"date":"2018-09-03T10:32:20","date_gmt":"2018-09-03T10:32:20","guid":{"rendered":"https:\/\/mbabullshit.com\/bull\/?p=842"},"modified":"2024-10-31T16:00:19","modified_gmt":"2024-10-31T09:00:19","slug":"capm-capital-asset-pricing-model-in-3-minutes-youtube-video-below","status":"publish","type":"post","link":"https:\/\/mbabull.com\/bull\/2018\/09\/03\/capm-capital-asset-pricing-model-in-3-minutes-youtube-video-below\/","title":{"rendered":"CAPM Capital Asset Pricing Model in 3 minutes (YouTube Video Below)"},"content":{"rendered":"<h2>3 Minute Overview (Also Download Free Cheet Sheet at Bottom) and then scroll down for detailed calculations video<\/h2>\n<p><iframe loading=\"lazy\" width=\"560\" height=\"315\" src=\"https:\/\/www.youtube.com\/embed\/gzxKd2S2MdU?si=V86fZZlKLBc1BHzi\" title=\"YouTube video player\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<h2>Part 1<\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/LWsEJYPSw0k?rel=0\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Part 2<\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/LH2BpIs1EF0?rel=0\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Beta for CAPM Premium Video (Free Preview)<br \/>\n*To watch this in FULL <a href=\"https:\/\/mbabull.com\/bull\/2018\/09\/07\/beta-for-capm\/\" target=\"_blank\" rel=\"noopener noreferrer\">click here<\/a><\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/2JxU9cryUSg\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Beta Levered vs. Unlevered Premium Video (Free Preview)<br \/>\n*To watch this in FULL <a href=\"https:\/\/mbabull.com\/bull\/2018\/09\/07\/beta-levered-vs-unlevered\/\" target=\"_blank\" rel=\"noopener noreferrer\">click here<\/a><\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/CQZ5cbpYcg8\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Arbitrage Pricing Theory vs. CAPM Premium Video (Free Preview)<br \/>\n*To watch this in FULL <a href=\"https:\/\/mbabull.com\/bull\/2018\/09\/07\/apt-1-arbitrage-pricing-theory-vs-capm\/\" target=\"_blank\" rel=\"noopener noreferrer\">click here<\/a><\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/eo5J4Wi2j_U\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Arbitrage Pricing Theory and Idiosyncratic Risk Premium Video (Free Preview)<br \/>\n*To watch this in FULL <a href=\"https:\/\/mbabull.com\/bull\/2018\/09\/07\/apt-2-arbitrage-pricing-theory-and-systematic-vs-idiosyncratic-risk\/\" target=\"_blank\" rel=\"noopener noreferrer\">click here<\/a><\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Wq-rhniEByc\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Arbitrage Pricing Theory and Portfolio Diversification Premium Video (Free Preview)<br \/>\n*To watch this in FULL <a href=\"https:\/\/mbabull.com\/bull\/2018\/09\/07\/apt-3-arbitrage-pricing-theory-and-portfolio-diversification\/\" target=\"_blank\" rel=\"noopener noreferrer\">click here<\/a><\/h2>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Iqev0F3k5Uc\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p style=\"text-align: left;\">\u00a0<strong>Download FREE Cheat-Sheet PDF on <a title=\"CAPM Cheat Sheet\" href=\"https:\/\/mbabullshit.com\/blog\/wp-content\/uploads\/2013\/03\/CAPM-CheatSheet-Capital-Capital-Asset-Pricing-Model.pdf\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-size: 1.17em; line-height: 19px;\">CAPM<\/span> <span style=\"font-size: 1.17em; line-height: 19px;\">click\u00a0here<\/span><\/a><\/strong><\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li>CAPM is just a \u201cmodel\u201d or formula used to calculate COST OF EQUITY<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>Cost of Equity is how much an investor \u201cwants\u201d to earn for investing in a company which is more risky than a safe bank deposit (or government bond), and (usually) more risky than investing in the general stock market with a bunch of stocks.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>It&#8217;s called a &#8220;cost&#8221; because that&#8217;s how much you should &#8220;fairly&#8221; pay your investors for investing in your risky company.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>In more complicated problems, you include the cost of equity as part of your\u00a0<a href=\"https:\/\/mbabullshit.com\/blog\/2011\/08\/06\/wacc-weighted-average-cost-of-capital-how-to-calculate-wacc\/\">WACC<\/a>\u00a0or\u00a0<a href=\"https:\/\/mbabullshit.com\/blog\/2011\/08\/06\/wacc-weighted-average-cost-of-capital-how-to-calculate-wacc\/\">Weighted Average Cost of Capital<\/a><\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>CAPM assumes that investing in many stocks is safer than investing in just one company\u2019s stock: \u201cdon\u2019t put all your eggs in one basket\u201d sorta thing.. this is called \u201cdiversified\u201d risk<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>Rationale: An investor would \u201cwant\u201d (or \u201cexpect\u201d) more income (\u201creturn\u201d) for investing in a highly risky company instead of the zero-risk \u00a0bank\/bond, and also instead of investing in a \u201cmedium-risk\u201d general stock market.\u00a0 Therefore, cost of equity = \u201cexpected return\u201d<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>You calculate Cost of Equity using the CAPM or Capital Asset Pricing Model Formula:<\/p>\n<p align=\"center\">K<sub>e<\/sub>\u00a0= R<sub>f<\/sub>\u00a0+ B (R<sub>m<\/sub>-R<sub>f<\/sub>)<\/p>\n<p>DON\u2019T panic! It\u2019s MUCH\u00a0 EASIER than it looks! See this formula step-by-step in action, watch it for free in the video above.<\/p>\n<p><img decoding=\"async\" style=\"font-size: 13px; line-height: 19px;\" src=\"https:\/\/mbabullshit.com\/blog\/wp-content\/uploads\/2013\/02\/CAPM-e1362045923707.jpg\" alt=\"CAPM Capital Asset Pricing Model\" \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>3 Minute Overview (Also Download Free Cheet Sheet at Bottom) and then scroll down for detailed calculations video Part 1 Part 2 Beta for CAPM Premium Video (Free Preview) *To watch this in FULL click here Beta Levered vs. Unlevered Premium Video (Free Preview) *To watch this in FULL click here Arbitrage Pricing Theory vs. [&#8230;]\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35],"tags":[],"class_list":["post-842","post","type-post","status-publish","format-standard","hentry","category-free-videos"],"_links":{"self":[{"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/posts\/842","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/comments?post=842"}],"version-history":[{"count":3,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/posts\/842\/revisions"}],"predecessor-version":[{"id":20967,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/posts\/842\/revisions\/20967"}],"wp:attachment":[{"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/media?parent=842"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/categories?post=842"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mbabull.com\/bull\/wp-json\/wp\/v2\/tags?post=842"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}