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In finance, the beta (β or market beta or beta coefficient) is a statistic that measures the expected increase or decrease of an individual stock price in proportion to movements of the stock market as a whole. Beta can be used to indicate the contribution of an individual asset to the market risk of a portfolio when it is
To calculate beta, investors divide the covariance of an individual stock (say, Apple) with the overall market, often represented by the Standard & Poor’s 500 Index, by the variance of the ...
An estimation of the CAPM and the security market line (purple) for the Dow Jones Industrial Average over 3 years for monthly data.. In finance, the capital asset pricing model (CAPM) is a model used to determine a theoretically appropriate required rate of return of an asset, to make decisions about adding assets to a well-diversified portfolio.
How to calculate beta. Beta is calculated by taking the covariance between the return of an asset and the return of the market and dividing it by the variance of the market. The measure is ...
Beta measures how volatile a stock is in relation to the broader stock market over time. A stock with a high beta indicates it's more volatile than the overall market and can react with dramatic ...
In financial economics, finance, and accounting, the earnings response coefficient, or ERC, is the estimated relationship between equity returns and the unexpected portion of (i.e., new information in) companies' earnings announcements.
Yahoo Finance is a media property that is part of the Yahoo network. It provides financial news, data and commentary including stock quotes , press releases , financial reports , and original content.
In investing, upside beta is the element of traditional beta that investors do not typically associate with the true meaning of risk. [1] It is defined to be the scaled amount by which an asset tends to move compared to a benchmark, calculated only on days when the benchmark's return is positive.