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Wrote Analysts has just used the CAPM model to compute an rE of 18.679% for the VaperWare company. It found rE by, among other things, computing Beta from a regression between the historical stock returns
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Wrote Analysts has just used the CAPM model to compute an rE of 18.679% for the VaperWare company. It found rE by, among other things, computing Beta from a regression between the historical stock returns of Vaperware and the SPY ETF. The R2 of this regression was 12%.

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What could possibly be problematic with WroteAnalysts' estimated rE for the VaperWare company?

User Kdazzle
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Answer:

What Grade is this again?

User Applejuiceteaching
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