An Empirical Study on CAPM with Respect to NSE NIFTY Stocks

The total risk of a security can be bifurcated into systematic and unsystematic risk. The later is eliminated by more and more diversification. On the other hand, the systematic risk is one which cannot be eliminated and is correlated with the market. A stock is efficient if there is no unsystematic risk. Therefore, the only effect a security has on the market risk is through its systematic risk. By calculating systematic risk cannot conclusion whether securities are exactly priced or not. CAPM helps identifying the assets qualitatively which are under-priced or over-priced. Thus selecting the stock is become a challenge to get the expected return by the investor. For facilitating the investor for the selection of right priced stocks this research is done with the help of CAPM with respect to NSE NIFTY stocks