Expanded CAPM for private companies

CFA Level II
#1

Hi all, Can somebody explain this to me plz? What rates do I add to CAPM ? Many thanks, S

#2

Expanded CAPM = CAPM + Premium for small size + Premium for company-specific risk Since CAPM = Rf + β (Rm – Rf) So, Expanded CAPM = Rf + β (Rm – Rf) + Premium for small size + Premium for company-specific risk You don’t have to calculate the premiums for size and company specific risks, hopefully they’ll be given in the vignette. I hope that answers your question. In case of any problem or if you need further elaboration, feel free to ask! Good Luck!

#3

[original post removed]

#4

FFM and eCAPM are totally different. They use different factors.