cramirezorozco5226 cramirezorozco5226
  • 11-11-2020
  • Business
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A stock has a correlation with the market of 0.53. The standard deviation of the market is 29%, and the standard deviation of the stock is 32%. What is the stock's beta?

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Parrain
Parrain Parrain
  • 12-11-2020

Answer: 0.58

Explanation:

Given the parameters in the question, Beta can be solved by the following formula;

= Correlation with market * ( Standard deviation of stock / Standard deviation of market)

= 0.53 * (32%/29%)

= 0.58

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