What is CAPM? Although financial analysts prefer using ratios analysis formula in valuation of assets, the CAPM formula is an essential section in capital budgeting. The Capital Asset Pricing Model (CAPM) describes the link between expected return and systematic risk for assets. It is a...

Now, actually what is the purpose of ratio analysis? Ratios are extremely important tools in financial analysis since they help financial analysts implement plans that improve interest coverage, leverage, reordering, financial structure, liquidity, and profitability. In other words, financial ratios help measure the relative performance...