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To figure the expected return for an investment’s level of risk, analysts use beta, which measures an asset’s volatility and can be used to gauge risk. If a stock has a beta of 1.2, it might ...
The Blume beta shrinks the estimated OLS beta towards a mean of 1, calculating the weighted average of 2/3 times the historical OLS beta plus 1/3. A version based on monthly rates of return is widely distributed by Capital IQ and quoted on all financial websites. It predicts future market-beta poorly. [citation needed]
Key. ER: Expected return on a specific asset RFR: Risk-free rate, typically the return on a Treasury security Beta: The volatility of the investment MR: The return on a comparable market index To ...
[] / [] is the "beta", return mentioned — the covariance between the asset's return and the market's return divided by the variance of the market return — i.e. the sensitivity of the asset price to movement in the market portfolio's value (see also Beta (finance) § Adding an asset to the market portfolio).
Continue reading → The post 8 Best Investments to Generate Monthly Income appeared first on SmartAsset Blog. Bills for utilities, mortgages, auto loans and similar expenses usually arrive ...
Viewed from the implementation side, investment techniques and strategies are the means to either capture risk premia (beta) or to obtain excess returns (alpha). Whereas returns from beta are a result of exposing the portfolio to systematic risks (traditional or alternative), alpha is an exceptional return that an investor or portfolio manager ...
An asset has a Beta of zero if its returns change independently of changes in the market's returns. A positive beta means that the asset's returns generally follow the market's returns, in the sense that they both tend to be above their respective averages together, or both tend to be below their respective averages together.
The Federal Deposit Insurance Corporation tracks monthly average interest rates paid on savings and other deposit accounts, like certificates of deposit, that offer insight into the interest you ...