Question: estimate a regression with stock's excess return as the dependent (Y) variable and the S&P 500 excess return as the independent (X) independent variable. compute

estimate a regression with stock's excess return as the dependent (Y) variable

and the S&P 500 excess return as the independent (X) independent variable.

compute excess return, assume risk free rate to be 3%. (1

Stock Return Market Return

0.029239093 0.054892511

-0.031040806 -0.004188588

0.024533589 0.023201461

Do I subtract the risk free rate for both columns to then run the regression?

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