Paying users zone. Data is covered by .

  • Get to Altria Group Inc. for $17.99, or

  • get to whole website for at least 3 months from $49.99.

 

$17.99

Capital Asset Pricing Model (CAPM)

Difficulty: Intermediate

Capital asset pricing model (CAPM) indicates what should be the expected or required rate of return on risky assets like Altria Group's common stock.


Rates of Return

Altria Group Inc., monthly rates of return

 
Altria Group Inc. (MO) Standard & Poor's 500 (S&P 500)
t Date PriceMO,t1 DividendMO,t1 RMO,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2013
1. Feb 28, 2013 % %
2. Mar 31, 2013 % %
3. Apr 30, 2013 % %
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2017 % %
59. Dec 31, 2017 % %
Average: % %
Standard Deviation: % %
Altria Group Inc. (MO) Standard & Poor's 500 (S&P 500)
t Date PriceMO,t1 DividendMO,t1 RMO,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2013
1. Feb 28, 2013 % %
2. Mar 31, 2013 % %
3. Apr 30, 2013 % %
4. May 31, 2013 % %
5. Jun 30, 2013 % %
6. Jul 31, 2013 % %
7. Aug 31, 2013 % %
8. Sep 30, 2013 % %
9. Oct 31, 2013 % %
10. Nov 30, 2013 % %
11. Dec 31, 2013 % %
12. Jan 31, 2014 % %
13. Feb 28, 2014 % %
14. Mar 31, 2014 % %
15. Apr 30, 2014 % %
16. May 31, 2014 % %
17. Jun 30, 2014 % %
18. Jul 31, 2014 % %
19. Aug 31, 2014 % %
20. Sep 30, 2014 % %
21. Oct 31, 2014 % %
22. Nov 30, 2014 % %
23. Dec 31, 2014 % %
24. Jan 31, 2015 % %
25. Feb 28, 2015 % %
26. Mar 31, 2015 % %
27. Apr 30, 2015 % %
28. May 31, 2015 % %
29. Jun 30, 2015 % %
30. Jul 31, 2015 % %
31. Aug 31, 2015 % %
32. Sep 30, 2015 % %
33. Oct 31, 2015 % %
34. Nov 30, 2015 % %
35. Dec 31, 2015 % %
36. Jan 31, 2016 % %
37. Feb 29, 2016 % %
38. Mar 31, 2016 % %
39. Apr 30, 2016 % %
40. May 31, 2016 % %
41. Jun 30, 2016 % %
42. Jul 31, 2016 % %
43. Aug 31, 2016 % %
44. Sep 30, 2016 % %
45. Oct 31, 2016 % %
46. Nov 30, 2016 % %
47. Dec 31, 2016 % %
48. Jan 31, 2017 % %
49. Feb 28, 2017 % %
50. Mar 31, 2017 % %
51. Apr 30, 2017 % %
52. May 31, 2017 % %
53. Jun 30, 2017 % %
54. Jul 31, 2017 % %
55. Aug 31, 2017 % %
56. Sep 30, 2017 % %
57. Oct 31, 2017 % %
58. Nov 30, 2017 % %
59. Dec 31, 2017 % %
Average: % %
Standard Deviation: % %

Show All

1 Data in USD $ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of MO during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t

Top


Systematic Risk (β) Estimation

 
VarianceMO
VarianceS&P 500
CovarianceMO, S&P 500
Correlation CoefficientMO, S&P 5001
βMO2
αMO3

Calculations

1 CovarianceMO, S&P 500 ÷ (Standard DeviationMO × Standard DeviationS&P 500)
= ÷ ( × )

2 CovarianceMO, S&P 500 ÷ VarianceS&P 500
= ÷

3 AverageMO – βMO × AverageS&P 500
= ×

Top


Expected Rate of Return

 
Assumptions
Rate of return on LT Treasury Composite1 RF %
Expected rate of return on market portfolio2 E(RM) %
Systematic risk (β) of Altria Group's common stock βMO
Expected rate of return on Altria Group's common stock3 E(RMO) %

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

Calculations

2 See Details »

3 E(RMO) = RF + βMO [E(RM) – RF]
= % + [% – %]
= %

Top