infonet-economy

The article presents the findings of the study concerning the effect of elliptical distribution to returns in capital markets. It notes that elliptical distributions may be specified through the mean, variance, and density generator. Moreover, the Capital Assets Pricing Model retains validity to the elliptical distributions. It points out that the empirical research studies the 500 stock returns reveals by January 1990 to December 2004. It states that the good outcome reveals that best return rate is the log-logistic while the bad result shows that funds for the portfolio should be held in subset funds in the distribution to maintain CAPM.