6. The beta coefficient

A stocks contribution to the market risk of a well-diversified portfolio is called ** (Fill in the blank) ** risk. It can be measured by a metric called the beta coefficient, which calculates the degree to which a stock moves with the movements in the market.

Based on your understanding of the beta coefficient, indicate whether each statement in the following table is true or false:

Statement	True	False
Beta coefficients are generally calculated using historical data.
Higher-beta stocks are expected to have higher required returns.
Stock As beta is 1.0; this means that the stock has a negative correlation with the market.