How do you calculate beta portfolios?


Calculate the beta of your portfolio to position your holdings for moves with the market, according to 'Modern Portfolio Theory and Investment Analysis' (2009). The concept of investment timing requires the adjustment of portfolio beta prior to market moves. For example, when an investment manager believes the market is about to rise, she may adjust the portfolio's beta higher to create additional upward price sensitivity for portfolio holdings.
Q&A Related to "How do you calculate beta portfolios?"
1. Obtain the beta values for each stock in the portfolio. Go to the Yahoo! Stock Quote site (see "Resources" Enter the stock ticker symbol into the quote box and hit the
As for the beta of your portfolio, it will change as the portfolio changes. And yes mutual funds and bonds and treasury notes do have a beta. Generally the beta is calculated based
Beta is a variable in concept stock problems. It finds the relationship between the rate of return and market premium rate. The beta value is the slope of the line when this relationship
The beta of a portfolio is the weighted average of individual betas of assets in that portfolio. There is an example of portfolio beta calculation here:
1 Additional Answer Answer for: calculate portfolio beta
How to Calculate the Beta of a Portfolio
A stock's beta theoretically measures price sensitivity compared with the market. Investors with multiple positions should consider their portfolio's beta. Sophisticated investors may want to take a closer look at beta measurement. Calculation of... More »
Difficulty: Moderately Challenging
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An unlevered beta assumes zero debt. The Hamada equation demonstrates that when a firm rises its debt, the financial leverage also rises the firm's risk and, in ...
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