Capital asset pricing theory asserts that portfolio returns are best explained by
A)economic factors.
B)specific risk.
C)systematic risk.
D)diversification.

Question

Quizplus · Accepted Answer

Capital asset pricing theory argues that portfolio returns are primarily driven by systematic risk or market risk, rather than the specific risk of individual assets. Therefore, the best explanation for portfolio returns is systematic risk.

Capital Asset Pricing Theory Asserts That Portfolio Returns Are Best