Scientific paper - Preliminary note / Short communication
The application of the CAPM model on selected shares on the Croatian capital market

Odobašić, Sandra; Tolušić, Marija; Tolušić, Zrinka (2014)
Metadata
Language English
Title (English)The application of the CAPM model on selected shares on the Croatian capital market
AuthorOdobašić, Sandra
Tolušić, Marija
Tolušić, Zrinka
Abstract (English)
The Capital Asset Pricing Model is a model that describes the relationship between risk, expected return and valuation of securities. The theoretical and practical value of this model has proved unquestionable, but under ideal circumstances. The theory has been utilized by numerous researchers and it confirms the linear relationship between risk and return under the CAPM (Capital Asset Pricing Model) model showing that greater exposure to risk provides higher returns. However, empirical research showed there were numerous factors that CAPM model did not take into account since it is based on assumptions which exist in reality, but are invisible. Therefore, it is very interesting to study the application of the CAPM model on selected shares on the Croatian capital market and analyze the possibilities of its application in discovering the misvalued shares. Share price changes on the Croatian capital market suggest there are some unknown factors that also influence share valuation. There is no doubt that the fundamental analysis of shares is not sufficient for evaluating the real share value in light of various invisible elements and all available information available which affect their value as well.
Keywords (English)CAPM Model share return risk beta index
Publication typescientific paper - preliminary note / short communication
Publication statuspublished
Peer reviewpeer review
Journal titleEkonomski vjesnik : Review of Contemporary Entrepreneurship, Business, and Economic Issues
Numbering2014, Vol. XXVII, No. 2, pp 297-311
ISSN0353-359X
e-ISSN1847-2206
Datepublication: 24.12.2014.
Article URLhttp://hrcak.srce.hr/132838
Scientific fieldSOCIAL SCIENCES
Economics
InstitutionJosip Juraj Strossmayer University of Osijek, Department of Cultural studies
URN:NBNhttps://urn.nsk.hr/urn:nbn:hr:145:952041