Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Assume you run a regression of a stock's excess return on the market excess return. The regression has an intercept of -4% and a coefficient
Assume you run a regression of a stock's excess return on the market excess return. The regression has an intercept of -4% and a coefficient on the market of 0.8. If the average excess return to the market over this period was 11%, what was the average excess return to the stock over this same period? (Excess return is defined for this question as any return minus the riskfree rate)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started