capital market line

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Capital market line (CML)

The line defined by every combination of the risk-free asset and the market portfolio. The line represents the risk premium you earn for taking on extra risk. Defined by the capital asset pricing model.

Capital Market Line

In the capital asset pricing model, a line that plots the extra return an investor expects for each change in the level of risk. Rational investors expect higher returns for riskier assets and the capital market line shows this graphically. A portfolio that accurately reflects the capital market line is considered a Markowitz efficient portfolio. The slope of the capital market line is a calculation of the equilibrium market price of risk. See also: Beta.

capital market line

The line used in the capital-asset pricing model to present the rates of return for efficient portfolios. These rates will vary depending upon the risk-free rate of return and the level of risk (as measured by beta) for a particular portfolio. The capital market line shows a positive linear relationship between returns and portfolio betas. Also called market line. See also alpha, beta, systematic risk.
References in periodicals archive ?
It meant colleges were private enterprises, focused on competing for students on free market lines.
The net proceeds from the offering will be utilised for general corporate purposes, which may include repaying outstanding borrowings under Newfield's credit facility and money market lines of credit, funding capital expenditures and working capital.
Net proceeds from the offering will be used by the company for general corporate purposes, repaying outstanding borrowings under its credit facility & money market lines of credit, funding capital expenditures as well as working capital.
Mike has tremendous experience in the infrastructure industry, having served in a leadership capacity in each of our market lines, said Chuck Harrington, Parsons Chairman and CEO.
We raised approximately USD815 million of net proceeds through last week's issuance of common stock and repaid all borrowings under our revolving credit facility and money market lines of credit.
independent insurance business beyond traditional market lines.
The town centre will be closed to traffic for the day as the bustling food market lines the streets with stalls and a feast for all ages including a skating tomato and mad chefs.
Meanwhile, a Continental Market lines Lord Street, with a range of European delights.
A local producers' market is in full swing in the Town Hall Gardens, while a continental market lines Lord Street.
Structuring our business along market lines will provide an even closer connection to our customers, accelerate our Web-First strategy and speed decision-making across the enterprise.
NEW YORK -- While it might seem counterintuitive, sales of prestige beauty items are performing better in a struggling economy than mass market lines, and chain drug retailers have noticed.
Now in its third incarnation, Wedgwood's Emerilware has retained the best elements of the Emeril Professional, Emeril Signature and Emeril's Market lines and built upon them.