Equilibrium market price of risk - The slope of the capital market line (C.M.L.). Since the C.M.L. represents the expected return offered to compensate for a perceived level of risk, each point on the line is a balanced market condition, or equilibrium. The slope of the line determines the additional expected return needed to compensate for a unit change in risk. The equation of the C.M.L. is defined by the Capital Asset Pricing Model.
Equilibrium market price of risk : the slope of the capital market line (c.m.l.). since the c.m.l. represents the expected return offered to compensate for a perceived level of risk, each point on the line is a balanced market condition, or equilibrium. the slope of the line determines the additional expected return needed to compensate for a unit change in risk. the equation of the c.m.l. is defined by the capital asset pricing model.
Equilibrium market price of risk