Securities with returns that lie below the security market line are undervalued.

Name: Securities with returns that lie below the security market line are undervalued.
Brand: Quizplus
Rating: 4.8 (27 reviews)

Question

Quizplus · Accepted Answer

Securities with returns below the security market line are considered overvalued as they do not offer expected returns for the level of risk they possess. Securities that lie above or on the security market line are considered fairly valued, while those lying below the line are deemed overvalued.

Securities with Returns That Lie Below the Security Market Line