Model inputs
percent · e.g. 4 = 4%
market input mode
%
e.g. a long-dated government bond yield
β
sensitivity to market moves · 1.0 = market
%
your assumption for the broad market's expected total return
updates live as you type
Results
equity risk premium
0%4%8%12%16%
expected return E[R]
—
—
rf + β × (rm − rf)
0%8%16%24%32%
risk-free rate · rf—
beta · β—
market return assumption · rm—
equity risk premium · rm − rf—
β × (rm − rf) · premium contribution—
Beta sensitivity
E[R] across beta 0.5 → 2.0 at the premium above — row highlighted if it matches your input.
| beta | premium contribution | E[R] |
|---|
awaiting your numbers
Educational note: every input is your own assumption, and CAPM output is an expected-return estimate only — a required-return benchmark for systematic risk, not a promise of results.
how it’s calculated
| equity risk premium | rm − rf — what the market is assumed to pay above the risk-free rate |
| premium contribution | β × (rm − rf) — your asset’s slice of that premium, scaled by systematic risk |
| expected return E[R] | rf + β × (rm − rf) — risk-free base plus your risk share |
| beta | Cov(asset, market) ÷ Var(market) — sensitivity to overall market moves |