Testing the Capital Asset Pricing Model (CAPM) on the Tunisian Stock Market:

This study aimed to examine whether the Capital Asset Pricing Model (CAPM) can be applied to the Tunisian stock market and whether the beta coefficient can explain fluctuations in stock returns traded in this market. According to CAPM, the model can provide investors with the minimum expected returns required to compensate for systematic risk. The researchers tested the model’s validity on the Tunisian market by analyzing monthly closing prices of 61 listed companies (excluding those suspended from trading), monthly market index values, and interest rates on savings deposits as a proxy for the risk-free rate during the study period. The results showed that the CAPM is not valid for application in the Tunisian stock market.