The CAPM uses standard deviation to relate an asset's risk relative to the market to the asset's required return.

Name: The CAPM uses standard deviation to relate an asset's risk relative to the market to the asset's required return.
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The CAPM uses beta, not standard deviation, to relate an asset's risk relative to the market to the asset's required return. Beta measures the asset's volatility relative to the market.

The CAPM Uses Standard Deviation to Relate an Asset's Risk