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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
You have developed data which give (1) the average annual returns on the market for the past five years, and (2) similar information on Stocks A and B. If these data are as follows, which of the possible answers best describes the historical betas for A and B?
Years |
Market |
Stock A |
Stock B |
1 |
0.03 |
0.16 |
0.05 |
2 |
-0.05 |
0.20 |
0.05 |
3 |
0.01 |
0.18 |
0.05 |
4 |
-0.10 |
0.25 |
0.05 |
5 |
0.06 |
0.14 |
0.05 |
 |  |  |  |
Â
 |  |
Answers: | a.
bAÂ >Â Â 0; bBÂ =Â Â 1 |
 | b.
bAÂ > +1; bBÂ =Â Â 0 |
 | c.
bAÂ =Â Â 0; bBÂ = -1 |
 | d.
bAÂ <Â Â 0; bBÂ =Â Â 0 |
 | e.
bAÂ < -1; bBÂ =Â Â 1 |
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