Question
Which of the following statements is FALSE? Select one: A. Beta is the expected percent change in the excess return of the security for a
Which of the following statements is FALSE?
Select one:
A. Beta is the expected percent change in the excess return of the security for a 1% change in the excess return of the market portfolio.
B. Beta represents the amount by which risks that affect the overall market are amplified for a given stock or investment.
C. It is common practice to estimate beta based on the historical correlation and volatilities.
D. Beta measures the diversifiable risk of a security, as opposed to its market risk, and is the appropriate measure of the risk of a security for an investor holding the market portfolio.
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