Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

What can you infer about a stock that has a beta of 0.85 ? The standard deviation of the stock is expected to be 85.00

What can you infer about a stock that has a beta of 0.85?

The standard deviation of the stock is expected to be 85.00% of that of the market
The covariance of the stock is 15.00% lower than the covariance of the market
If the market falls by 1.00%, the stock is expected to fall by 0.85%
The covariance between the stock and the market is less than zero
Investors can expect a -15.00% greater/(lower) return on the stock than the overall market

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Handbook Of Research On Decision Making Techniques In Financial Marketing

Authors: Hasan Dinçer, Serhat Yüksel

1st Edition

1799825590, 978-1799825593

More Books

Students also viewed these Finance questions