This topic contains a solution. Click here to go to the answer

Author Question: Which of the following statements regarding beta coefficient is correct? (Read 39 times)

mccallkeeler

  • Full Member
  • ***
  • Posts: 149
Which of the following statements regarding beta coefficient is correct?

According to the definition of beta coefficient,a stock with a high standard deviation will tend to have a high beta, which means that it contributes a relatively large amount of risk to a well-diversified portfolio.


The stand-alone risk of an individual stock, which is called its beta coefficient, b, is defined under the CAPM as the amount of risk that the stock contributes to the market portfolio.


According to the definition of beta coefficient, a stock with a high correlation with the market will also have a small beta, and hence be less risky.


We cannot obtain the beta coefficient based on the covariance between a stock and the market and the standard deviation of the market’s return.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by mccallkeeler on Aug 7, 2023

koung719

  • Full Member
  • ***
  • Posts: 164
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
Answer Preview
Only 39% of students answer this correctly




mccallkeeler

  • Member
  • Posts: 149
Reply 2 on: Aug 7, 2023
Gracias!


Dinolord

  • Member
  • Posts: 313
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

Did you know?

To maintain good kidney function, you should drink at least 3 quarts of water daily. Water dilutes urine and helps prevent concentrations of salts and minerals that can lead to kidney stone formation. Chronic dehydration is a major contributor to the development of kidney stones.

Did you know?

The Romans did not use numerals to indicate fractions but instead used words to indicate parts of a whole.

Did you know?

It is important to read food labels and choose foods with low cholesterol and saturated trans fat. You should limit saturated fat to no higher than 6% of daily calories.

Did you know?

Fewer than 10% of babies are born on their exact due dates, 50% are born within 1 week of the due date, and 90% are born within 2 weeks of the date.

Did you know?

The familiar sounds of your heart are made by the heart's valves as they open and close.

For a complete list of videos, visit our video library