Final answer:
According to the CAPM, underpriced securities would have negative betas and positive alphas.
Step-by-step explanation:
According to the Capital Asset Pricing Model (CAPM), underpriced securities would have negative betas and positive alphas. The beta measures the systematic risk of a security, and a negative beta suggests that the security moves in the opposite direction of the market.
On the other hand, the alpha measures the excess return of a security compared to its expected return, and a positive alpha indicates that the security is undervalued. Therefore, based on the CAPM, underpriced securities would have negative betas and positive alphas.