The capital asset pricing model (CAPM) measures the amount of an asset's expected return given the riskfree rate, the beta of the asset and the expected market return. To calculate an asset's expected return, subtract the riskfree rate from the expected market return and multiply the resulting value by the beta of the asset. Next, add the riskfree rate to that resulting value. This formula can be calculated in Microsoft Excel. (For more, see The Capital Asset Pricing Model: an Overview.)
Calculating CAPM in Excel
Assume you want to compare the expected returns between two public companies, Tesla Motors Incorporated and General Motors Company. Enter "Tesla Motors Incorporated" into cell B1 and "General Motors Company" into cell C1.
Tesla and GM are car manufacturing companies. Tesla has a beta of 1.16, while GM has a beta of 1.11. Assume the riskfree rate is 0.25% and the expected market return is 10% for the year.
Enter "RiskFree Rate" into cell A2, "Beta" into cell A3, "Expected Market Return" into cell A4 and "Expected Asset Return" into cell A5.
Enter "0.25%" into cell B2, "=1.17" into cell B3 and "10%" into cell B4. The expected return of Tesla Motors for the year is calculated using the CAPM formula. In cell B5, enter "=B2+B3*(B4B2)". The resulting expected return of Tesla is 12%.
Next, enter "0.25%" into cell C2, "=1.11" into cell C3 and "10%" into cell C4. The expected return of General Motors is calculated by entering the formula "=C2+C3*(C4C2)" into cell C5. General Motors Company has an expected return of 11%.

How do I calculate the equity risk premium in Excel?
Find out how to calculate the equity risk premium for an individual security using Microsoft Excel, including how to estimate ... Read Answer >> 
What is the formula for calculating return on assets (ROA) in Excel?
Find out more about the return on assets, or ROA, ratio and the formula for calculating a company's return on assets in Microsoft ... Read Answer >> 
What is the formula for calculating the pricetoearnings (P/E) ratio in Excel?
Find out more about the pricetoearnings, or P/E, ratio, the P/E ratio formula and how to calculate the P/E ratio in Microsoft ... Read Answer >> 
How do I calculate the expected return of my portfolio in Excel?
Find out how to calculate the total expected annual return of your portfolio in Microsoft Excel using the value and return ... Read Answer >> 
What is the formula for calculating the inventory turnover ratio in Excel?
Find out more about inventory turnover ratio and the formula for calculating a company's inventory turnover ratio using Microsoft ... Read Answer >> 
How do you calculate present value in Excel?
Learn what present value and future value are and how to use Microsoft Excel to calculate present value, given the future ... Read Answer >>

Investing
The Capital Asset Pricing Model: an Overview
CAPM helps you determine what return you deserve for putting your money at risk. 
Tech
CAPM vs. Arbitrage Pricing Theory: How They Differ
Both project the expected rate of return given the level of risk assumed, but they consider different variables. 
Investing
How AQR Places Bets Against Beta
Learn how the bet against beta strategy is used by a large hedge fund to profit from a pricing anomaly in the stock market caused by high stock prices. 
Investing
Taking Shots at CAPM
Find out why many investors think the capital asset pricing model is full of holes. 
Financial Advisor
Calculating Beta: Portfolio Math For The Average Investor
Beta is a useful tool for calculating risk, but the formulas provided online aren't specific to you. Learn how to make your own. 
Insights
Simulating stock prices using excel
Here, we'll use the average of the change in log prices, volatility, normal distribution and Excel to formulate the future prices of an asset. This can amount to a very valuable tool for investors ... 
Investing
Beta: Know the Risk
Beta says something about measuring price risk in stocks, but how much does it say about fundamental risk factors too? 
Insights
Tesla Announces Solar Panel Collaboration With Panasonic, Delays New Product Launch (TSLA, SCTY)
Tesla's "unexpected" product launch will have to wait two more days.

Financial Modeling
The process by which a firm constructs a financial representation ... 
International Capital Asset Pricing Model (CAPM)
The international capital asset pricing model (CAPM) is a financial ... 
Manufacturing Cells
Manufacturing cells are sets of machines that are grouped by ... 
Stated Annual Interest Rate
A stated annual interest rate is the return on an investment ... 
Market Risk Premium
Market risk premium is the difference between the expected return ... 
Abnormal Return
A term used to describe the returns generated by a given security ...