Market Risk Premium

Financen31428 Jun, 2021Business

The difference that exists between the expected return on a marketplace portfolio and the risk free rate is termed as The market risk premium or it can also be recognized as the additional rate of return which is over and above the risk-free rate which is expected by the investors when holding up a risky investment. Here, the term risk is defined as any investment in which there exist some risks or which is not risk free.