Year Asset Return S&P 500 Return 1 12 7 2 12 14 3 -1 -3 4...

Year	Asset Return	S&P 500 Return
1	12	7
2	12	14
3	-1	-3
4	14	9
5	9	8
6	15	15
7	20	12
8	-10	-5
9	7	9
10	12	14

Find the Beta in Excel

Expert Solution


Year	Asset Return(x)	S&P 500(y)	*(x-(∑x/n))(y-(∑y/n))**	(y-(∑y/n))^2
1	12	7	-3	1
2	12	14	18	36
3	-1	-3	110	121
4	14	9	5	1
5	9	8	0	0
6	15	15	42	49
7	20	12	44	16
8	-10	-5	247	169
9	7	9	-2	1
10	12	14	18	36
Total	90	80	479	430
Expected Return=Total Return/total no. of years
So expected return=	9	8
	(90/10)	(80/10)

*Covariance=((∑(x-(∑x/n))(y-(∑y/n)))/n)**
So, covariance(x,y)=	47.90
	(479/10)

Variance of market= ((∑(y-(∑y/n))^2)/n)	43.00
	(430/10)

Beta=Covariance(x,y)/Variance of market	1.11
	47.9/43

jeff jeffy answered 1 year ago

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