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Levart [38]
2 years ago
10

How can a positive relationship between the expected return on a security and its beta be justified?

Business
1 answer:
pogonyaev2 years ago
8 0

A positive relationship between the expected return on a security and its beta is justified because there is likely to be a positive discrepancy between the market's return and the risk-free rate.

What do you mean by the significance of the beta coefficient explain it?

The beta coefficient calculates the likelihood that the price of a stock or security will fluctuate in response to changes in the market price. A stock or security's beta can also be used to calculate the systematic risks connected to investment.

What is the significance of the beta coefficient concerning the risk of security?

A stock's volatility can be compared to the systematic risk of the entire market using a beta coefficient. The slope of a line through a regression of data points is known statistically as beta.

Learn more about the relationship between the expected return on a security and its beta: brainly.com/question/24000487

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