Corporate Finance - Is Positive Beta Better than Negative Beta?

Anonymous
timer Asked: Sep 6th, 2018
account_balance_wallet $10

Question description

Is Positive Beta Better than Negative Beta?

A Beta factor represents risk in a financial instrument or commodity. Explain the reasons for changes in beta and explain if one should be more concerned with a negative versus positive factor. Be sure to reference volatility. Please provide an example of negative Beta.

Tutor Answer

EagleEye1
School: University of Maryland

Attached.

Surname1
Name:
Tutor:
Course:
Date:
Cooperate finance- beta effects.
In the stock market, beta is a numeric value that is used to measure certain stock
fluctuations about the overall stock market. It is the linear dependence of a stocks return when
compared to the market return about the stocks to market’s volatility ratio. Beta increases with
the level of the risk involved but the returns speculated are equally high. An investment with a
zero beta means no risk involved. A negative beta outlines that the stock market moves in the
opposite direction. The negative beta investments rise when the market falls. Gold stocks possess
a negative beta since its value does not fluctuate the way currencies do. When markets grow, the
positive beta proves more pr...

flag Report DMCA
Review

Anonymous
Thanks, good work

Similar Questions
Hot Questions
Related Tags

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors