Question: In the yearend, a stock's realized return is usually different from predicted by CAPM model in the year beginning. What is the possible reason? Group
In the yearend, a stock's realized return is usually different from predicted by CAPM model in the year beginning. What is the possible reason?
Group of answer choices
Stock beta may change over time.
The market return is different from the prediction.
All are possible reasons.
B The companys idiosyncratic risk also contributes to the stock's realized return.
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