arbitrage pricing model

noun

arbitrage pricing model

noun

Business, Finance An asset pricing model using one or more common factors to price returns. With only one factor, representing the market portfolio, it is called a single factor model. With two or more factors, it is called a multifactor model.

Related terms: arbitrage pricing theory, capital asset pricing model

Entry derived from the Wiktionary, under licence CC BY-SA 4.0 — list of authors.