Beta, Financial Management

Beta

Beta is a measure of the market risk, or methodical risk, of a particular privacy or portfolio. Systematic risk defines any risk that influences the value of a huge number of assets. Beta measures a security's return over time relative to the overall market. (Note that market return is mostly measured by Standard & Poor's 500 Composite Stock Index or the Dow Jones 30 Industrials.) The higher the beta, the riskier, or the more volatile, is the stock or portfolio. Beta is commonly used to analyze the risk of equality common funds by showing the volatility of a fund relative to the market as a whole (as measured by the Standard & Poor's 500 Index of the most widely held stocks). A common fund with a beta of 1.0 would have returns that match those of the S&P 500. A common fund with a beta greater than 1.0 is more volatile, or riskier, than the market. A common fund with a beta less than 1.0 is not as risky, volatile, or as the market.

Posted Date: 10/15/2012 2:40:54 AM | Location : United States







Related Discussions:- Beta, Assignment Help, Ask Question on Beta, Get Answer, Expert's Help, Beta Discussions

Write discussion on Beta
Your posts are moderated
Related Questions
evaluate the importance of leverage in financial management of a small scale company

Common Size Financial Statement Common Size Financial Statement is a company financial statement that shows all items as percentages of a common base figure. This kind of finan

CAPITAL STRUCTURE DEFINITION According to Gerstenberg, Capital structure refers to 'the makeup of a firm's capitalisation'.  In other way, it signifies the mix of different sou

Explain and critically evaluate : a)  The relevance of committed fixed costs in deciding the optimal mix of products to maximum a company's profit and the importance of relevant

Q. Long and short dated volatility? 1. If an investor purchase long-dated volatility as well as sells short-dated volatility then the investor is expecting a decrease in the sh

Why does the riskiness of portfolios have to be looked at differently than the riskiness of individual assets? The riskiness of portfolios has to be seemed to be at differently

Explain the term "present value of the firm's operations" (also known as Enterprise Value ).  What does this number represent? The present value of the company's free cash flo

15 points) You need to develop a personal budget. Try to be as realistic as possible. If you are going to school and not working then do some research to find out what salary you w


How can secondary market organised the exchanges and over the counter markets? Exchanges and over-the-counter (OTC) markets: Secondary markets can be organised by exchanges