{"id":25432,"date":"2013-05-16T17:52:26","date_gmt":"2013-05-16T12:22:26","guid":{"rendered":"http:\/\/vskills.in\/certification\/tutorial\/?p=25432"},"modified":"2024-04-12T14:18:11","modified_gmt":"2024-04-12T08:48:11","slug":"capital-market-expectations","status":"publish","type":"page","link":"https:\/\/www.vskills.in\/certification\/tutorial\/capital-market-expectations\/","title":{"rendered":"Capital Market Expectations"},"content":{"rendered":"\n

Capital Market Expectations<\/strong><\/h4>\n\n\n

\u00a0<\/p>\n

The capital market theory builds upon the Markowitz portfolio model. The main assumptions of the capital market theory are as follows:<\/p>\n

    \n
  1. \n
      \n
    1. All Investors are Efficient Investors<\/em>\u00a0–\u00a0<\/strong>Investors follow Markowitz idea of the efficient frontier and choose to invest in portfolios along the frontier.<\/li>\n
    2. Investors Borrow\/Lend Money at the Risk-Free Rate\u00a0<\/strong>–\u00a0<\/em>This rate remains static for any amount of money.<\/li>\n
    3. The Time Horizon is equal for All Investors\u00a0<\/strong>–\u00a0<\/em>When choosing investments, investors have equal time horizons for the choseninvestments.<\/li>\n
    4. All Assets are Infinitely Divisible\u00a0<\/strong>–\u00a0<\/em>This indicates that fractional shares can be purchased and the stocks can be infinitely divisible.<\/li>\n
    5. No Taxes and Transaction Costs\u00a0<\/strong>–<\/em>assume that investors’ results are not affected by taxes and transaction costs.<\/li>\n
    6. All Investors Have the Same Probability for Outcomes\u00a0<\/strong>–<\/em>When determining the expected return, assume that all investors have the same probability for outcomes.<\/li>\n
    7. No Inflation Exists\u00a0<\/em>–\u00a0<\/strong>Returns are not affected by the inflation rate in a capital market as none exists in capital market theory.<\/li>\n
    8. There is No Mispricing Within the Capital Markets\u00a0<\/strong>–\u00a0<\/em>Assume the markets are efficient and that no mispricings within the markets\u00a0exist.<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n
      \n

      Apply for Portfolio Manager Certification Now!!<\/h3>\n

      http:\/\/www.vskills.in\/certification\/Certified-Portfolio-Manager<\/a><\/p>\n<\/div>\n\n\n

      Back to Tutorial<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

      Capital Market Expectations \u00a0 The capital market theory builds upon the Markowitz portfolio model. The main assumptions of the capital market theory are as follows: All Investors are Efficient Investors\u00a0–\u00a0Investors follow Markowitz idea of the efficient frontier and choose to invest in portfolios along the frontier. Investors Borrow\/Lend Money at the Risk-Free Rate\u00a0–\u00a0This rate remains…<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"categories":[2080],"tags":[4761],"class_list":["post-25432","page","type-page","status-publish","hentry","category-portfolio-management","tag-capital-market-expectations"],"acf":[],"yoast_head":"\nCapital Market Expectations - Tutorial<\/title>\n<meta name=\"description\" content=\"Capital Market Expectations\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.vskills.in\/certification\/tutorial\/capital-market-expectations\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Capital Market Expectations - Tutorial\" \/>\n<meta property=\"og:description\" content=\"Capital Market Expectations\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.vskills.in\/certification\/tutorial\/capital-market-expectations\/\" \/>\n<meta property=\"og:site_name\" content=\"Tutorial\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/vskills.in\/\" \/>\n<meta property=\"article:modified_time\" content=\"2024-04-12T08:48:11+00:00\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.vskills.in\/certification\/tutorial\/capital-market-expectations\/\",\"url\":\"https:\/\/www.vskills.in\/certification\/tutorial\/capital-market-expectations\/\",\"name\":\"Capital Market Expectations - 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