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Beta: Definition, Calculation, and Explanation for Investors
Beta is a measure of the volatility, or systematic risk, of a security or portfolio in comparison to the market as a whole. It is used in the capital asset pricing model.
How does Beta reflect systematic risk?
Beta can help investors understand if a stock price will fluctuate at a similar rate to the market – if it moves with the market, it has systematic risk.
Calculating Required Rate of Return (RRR)
What is the required rate of return? And why is it important for investors and corporations?
How to Calculate Beta in Excel
Here, we'll compare the beta values obtained from financial sources and explain how to compute beta using Microsoft Excel.
How Does Beta Measure a Stock's Market Risk?
Learn how beta is used to measure risk versus the stock market, and understand how it is calculated and used in the capital asset pricing model.
Alpha vs. Beta: What's the Difference?
Alpha measures the performance of a stock in relation to the overall market while beta is a measure of its volatility in relation to a benchmark.
Risk Premiums: Like Hazard Pay for Your Investments
A risk premium is the return in excess of the risk-free rate of return that an investment is expected to yield.
Beta Risk Definition
Beta risk is the probability that a false null hypothesis will be accepted by a statistical test.
How is the capital asset pricing model (CAPM) represented in the security market line (SML)?
Learn the definition of the capital asset pricing model and how CAPM is used in the calculation and graph of the security market line.
Volatility: Meaning In Finance and How it Works with Stocks
Volatility measures how much the price of a security, derivative, or index fluctuates.