Early test of the Capital Asset pricing model were performed which was dependent of the three basic elements-

A. Establishing sample data- It was dependent upon the establishment of the sample data according to which the Capital Asset pricing model was derived.

B. Estimating the securities characteristic line- A line which will be affecting the overall rate of return in respect to the systematic risk undertaken at a company

C. Estimation of the securities market line- Estimation of the security market line will be understanding the overall securities which are underpriced or overpriced and reflect the slope of the security market line as the market risk premium.

These models will be more focused towards estimation of rate of return of the company with respect to the overall security characteristic line and security market line and they will be trying to derive the expected market rate of return by directly undertaking the systematic risk and they are highly focused at Efficient market and no taxation.