1.

CML is a line used to illustrate return rates that depend on risk-free rates of return and
risk levels for a certain portfolio. SML, also referred to as a feature line, represents the
risk and return of the market graphically at a time.
2. The evaluation of risk factors represents one of the differences between CML and SML.
While standard deviation is a CML risk measurement, beta coefficient determines the
SML's risk factors.
3. The expected portfolio return for CML is displayed in the Y- axis during the calculation
of the returns. The return of securities along the Y axis is instead displayed for SML. The
standard deviation portfolio is shown in the X-axis for CML, whereas the X-axis for
SML shows the Beta of security.
4. The market portfolio and risk free assets are determined by the CML, all security factors
are determined by the SML.
5. Unlike the Capital Market Line, the Security Market Line shows the expected returns of
individual assets.
6. The CML determines the risk or return for efficient portfolios, and the SML demonstrates
the risk or return for individual stocks.
7. The Capital Market Line graphs define efficient portfolios, the Security Market Line
graphs define both efficient and non-efficient portfolios.
8. The Capital Market Line is considered to be superior than the SML while measuring the
risk factors.