Answer Posted / archit agrawal
Beta in the market measures the risk which cannot be diversified. Normally when you invest in the market you bear two types of risk, systemic risk & diversifiable risk. By being diversified, we can remove one type of risk, but we can't remove systemic risk.
Therefore Beta measure the risk which cannot be diversified.
Beta also measures the correlation between the stock price & stock market.
| Is This Answer Correct ? | 2 Yes | 0 No |
Post New Answer View All Answers
What is price earnings (p/e) ratio?
what is Tally and where it can be used?
How are local area banks different from small banks?
What are your views on demonetization?
What Do You Know About Minimum Subscription?
What is Crossed Cheque ?
What do you know about National Income and Per capita Income?
Who are venture capitalists?
When were the banks nationalized?
What help does effective marketing provide with?
What has the market been doing? Why? What do you think it will do in the coming 12 months?
When one party enjoys credit facilities by more than one banks who works in coordination with each other under a formal arrangement, what is the arrangement?
What type of insurance policies are there?
What is a balance sheet and a trial balance?
How will your professional knowledge be helpful in the banking career?