data Analytics

profiledexter90

 

The file Delldata.xlsx (available on the companion website) contains

monthly returns for the Standard & Poor’s stock index and for Dell stock.

The beta of a stock is defi ned as the slope of the least-squares line used to

predict the monthly return for a stock from the monthly return for the market.

Use this fi le to perform the following exercises:

a. Estimate the beta of Dell.

b. Interpret the meaning of Dell’s beta.

c. If you believe a recession is coming, would you rather invest in a highbeta

or low-beta stock?

d. During a month in which the market goes up 5 percent, you are 95

percent sure that Dell’s stock price will increase between which range

of values?

  • 4 years ago
  • 10
Answer(1)

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    dellbeta.doc
  • attachment
    Delldata.xls