What does CAPITAL MARKET LINE mean?

CAPITAL MARKET LINE meaning in Law Dictionary

commitment within the CAPITAL ASSET PRICING MODEL (CAPM) that relates the expected return of a PORTFOLIO to its expected DANGER (as assessed through TRADITIONAL DEVIATION). Under CAPM, all investors will choose a situation from the money market line by borrowing from the bank or lending within RISKFREE PRICE, since this maximizes return for a given degree of risk. See also SECURITY MARKET LINE.