# Thread: Formulate the k-factor beta model and show on excel

1. ## Formulate the k-factor beta model and show on excel

So I have an equation

$(\mu_i(t)-r_t)dt=\sum^K_{k=1}\beta_{ik}(t)(\mu_{X_k}(t)-r_t)dt$

where

$\beta_{ik}(t)=\frac{\frac{d_t}{S_i(t)X_k( t)}}{\frac{d_t}{X_k(t)^2}}$

2. ## Re: Formulate the k-factor beta model and show on excel

Is it just the formula for the arbitrage pricing theory?