Estimates of a stock's beta may vary depending on I. when the estimate was made II. the standard deviation of the stock's returns III. how many months of returns were used to estimate the beta IV. the index used to represent market returns. Group of answer choices I, II and III only I, II and IV only I, III and IV only II and IV only
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
Estimates of a stock's beta may vary depending on
I. when the estimate was made
II. the standard deviation of the stock's returns
III. how many months of returns were used to estimate the beta
IV. the index used to represent market returns.
Group of answer choices
I, II and III only
I, II and IV only
I, III and IV only
II and IV only
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