An Empirical Comparison of Asset-Pricing Models in the Shanghai A-Share Exchange Market (original) (raw)

2018, Asia-Pacific Financial Markets

This paper evaluates and compares the performance of three-asset pricing models-the capital asset pricing model of Sharpe (1964), the threefactor model of Fama and French (1993), and the five-factor model (Fama and French 2015)-in the Shanghai A-share exchange market. Our results do not support the superiority of the five-factor model and show that the three-factor model outperforms the other models. We also verify the redundancy of the book-to-market factor and confirm the findings of Fama and French (2015). JEL classification G1 • C5 Keywords Fama-French models • Capital asset pricing model • Shanghai exchange market

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