What does beta tell us? Group of answer choices A beta < 1 implies the asset has more systematic risk than the overall market A beta > 1 implies the asset has less systematic risk than the overall market A beta of 0 implies that the asset has more systematic risk than the overall market

Finance Dec 05, 2020

What does beta tell us?

Group of answer choices

A beta < 1 implies the asset has more systematic risk than the overall market

A beta > 1 implies the asset has less systematic risk than the overall market

A beta of 0 implies that the asset has more systematic risk than the overall market.

A beta of 1 implies the asset has the same systematic risk as the overall market

Expert Solution

Option IV is correct

Beta is a measure of systematic risk. Market will have a beta of 1 and if the asset also having the same beta of 1, then it is said to be that asset is having the same systematic risk as overall market.

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