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Author Question: Which of the following statements is correct? (Read 40 times)

Deej

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on: Aug 7, 2023
Which of the following statements is correct?

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The beta coefficient of a stock is normally found by regressing past returns on a stock against past market returns. One could also construct a scatter diagram of returns on the stock versus those on the market, estimate the slope of the line of best fit, and use it as beta. However, this historical beta is not always the same as the beta that exists in the future.


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If you found a stock with a negative historical beta and held it as the only stock in your portfolio, you would by definition have a riskless portfolio.


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The beta of a portfolio of stocks is always larger than the beta of any of the individual stocks.


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It is theoretically possible for a stock to have a beta of 1.0. If a stock did have a beta of 1.0, then, at least in theory, its required rate of return would be smaller than the risk-free (default-free) rate of return, rRF.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by Deej on Aug 7, 2023

ealonif

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Reply #1 on: Aug 7, 2023
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.
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Only 39% of students answer this correctly


Deej

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Reply 2 on: Aug 7, 2023
Excellent

tkempin

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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