An Empirical Test of CAPM: Application in Apple and Tesla Stocks

DOI

10.2991/978-94-6463-054-1_36How to use a DOI?

Keywords

CAPM; Beta coefficient; Investment preference; Regression analysis

Abstract

It is crucial for investors to select the investment portfolio in the market. Risk and return are long-standing paradoxes for investors, and the higher risk may indicate a higher return than other portfolios. This article uses the stock price of Apple stock and Tesla stock from 2017 to 2022 as a sample, the CAPM model was applied to conduct regression analysis on the overall return and individual stock return of the securities market, where the return influenced by the beta coefficient. Comparing the beta coefficient in Apple stock and Tesla stock, a higher beta was regressed in Apple stock, which means that some risk-averse will choose to buy some Tesla stock into their investment portfolio. However, after analysing the output and examining the regression model, CAPM may fail to be applied in Tesla stock.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Zihan Chen
PY  - 2022
DA  - 2022/12/14
TI  - An Empirical Test of CAPM: Application in Apple and Tesla Stocks
BT  - Proceedings of the 2022 2nd International Conference on Financial Management and Economic Transition (FMET 2022)
PB  - Atlantis Press
SP  - 316
EP  - 322
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-054-1_36
DO  - 10.2991/978-94-6463-054-1_36
ID  - Chen2022
ER  -