The Fama-French Model is a financial model that expands on the Capital Asset Pricing Model (CAPM) by including additional factors to explain stock returns. Developed by economists Eugene Fama and Kenneth French, it incorporates size and value factors alongside market risk, suggesting that smaller companies and those with high book-to-market ratios tend to outperform the market. The model uses three main factors: the market return, the size effect (small minus big, or SMB), and the value effect (high minus low, or HML). By analyzing these factors, investors can better understand and predict stock performance, enhancing investment strategies.