Meaning BETA EQUATION (SECURITY): The market beta of a security is determined as follows: Regress excess returns of stock y on excess returns of the market. The slope coefficient is beta. Define n as number of observation numbers. Beta = [(n) (sum of [xy]) ]-[ (sum of x) (sum of y)]/ [(n) (sum of [xx]) ]-[ (sum of x) (sum of x)] where: n = # of observations (usually 36 to 60 months) x = rate of return for the S;P 500 index y = rate of return for the security Related: Alpha
More terms such as Beta equation (security) in Dictionary B.
- Definition Benchmark Issue:
- Examples Also called on-the-run or current-coupon issue or bellwether issues. In the secondary market, the benchmark issue is the most recently auctioned Treasury issues for each maturity beta equation (security) definition.
- Definition Bank Trust Department:
- Examples Bank department that deals with estates, administers trusts, and provides services such as estate planning advice to its clients beta equation (security) explain.
- Definition Below Par:
- Examples Less than the nominal or face value of a security beta equation (security) what is.
- Definition Business Risk:
- Examples The risk that the cash flow of an issuer will be impaired because of adverse economic conditions, making it difficult for the issuer to meet its operating expenses beta equation (security) meaning.
- Definition Buy On Margin:
- Examples Borrowing to buy additional shares, using the shares themselves as collateral beta equation (security) abbreviation.
