Are the only differences that SML uses systematic risk and CML uses total risk? Otherwise, i assume there is no difference in what they mean and what they measure (expected return).
measure of risk - SML measures systemic risk (beta on x axis), CML total risk (std deviation on x axis) application - SML used to determine benchmark returns for securities, CML used for asset allocation (between risk free asset and mkt portfolio) definition - SML is graph of CAPM, CML is graph of efficient frontier slop - SML slope is market risk premium, CML slop is market risk premium per unit of risk (sharpe ratio)