Capital asset pricing model


 

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Capital asset pricing model

A model for generating expected equity returns. It is based on the premise that returns are the reward for taking on risk, and that risk can be split into two types: stock-specific risk and market risk.Since stock-specific risk can be mitigated by diversification policies, investors should not be compensated for taking this on. Expected returns should only be a function of the share's response to returns on the market as a whole, which is given by the share's beta.



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Arbitrage free option pricing models

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Yield curve option-pricing models.


Transfer pricing

Transfer pricing

Literally this only refers to the price charged on goods and services that are traded between subsidiaries of a multinational corporation. However, the term usually connotes the setting of such prices high or low so as to minimize the total taxes paid to different governments, in response to differences in corporate tax rates.


Repricing

Repricing

To change the price of an asset. In derivatives, it sometimes refers to the exchange of options of with different strike prices.


Garman Kohlhagen option pricing model

Garman Kohlhagen option pricing model

A model widely used to price foreign currency options.


Pricing efficiency

Pricing efficiency

Also called external efficiency; a market characteristic that prices at all times fully reflect all available information that is relevant to the valuation of securities.


Further Suggestions

Indication pricing schedule
Pricing to market
Administrative pricing rules
Asset pricing model
Two state option pricing model
Forward pricing
forward pricing
Binomial option pricing model
Capital asset pricing model (CAPM)
International Asset Pricing Model (IAPM)
Underpricing
Regulatory pricing risk
Option Pricing Curve


 
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