1. Determine the betas for the four securities by regressing each company's returns on the returns for the

S&P/NZX50 Index (close) for the period from 1st August 2016 to 31st July 2021.

1. SKY CITY Entertainment Group Limited (SKC)
2. Fletcher Building Limited (FBU.NZ)
3. Air New Zealand Limited (AIR.NZ)
4. The Warehouse Group Limited (WHS.NZ)

Explain what the values of the betas (the slope coefficients in the regression) indicate and discuss the

factors that might explain the differences in the betas of the four companies.

(Regression Calculation: Go to Data > Data Analysis and choose regression. The company returns constitute the Y input, and the

index returns the X input. Alternatively, the slope found in f(x) also represents Beta. If Data Analysis does not appear, you can

add the tool. It is available in Excel. Go to File > Options and choose Add-ins and go to Manage, then select click on the drop-

down button and select Excel Add-ins, then click on Go. Select Analysis Toolpak and OK).

2. A portfolios risk generally declines as the number of stocks in a portfolio increases. So could an

investor, by adding more stocks into their portfolio, completely eliminate risk? Why or why not?

Explain.