Question

    Which coefficient measures the volatility of a stock compared with the volatility of the market as a whole?   

    A Alpha Correct Answer Incorrect Answer
    B Beta Correct Answer Incorrect Answer
    C Gama Correct Answer Incorrect Answer
    D Delta Correct Answer Incorrect Answer
    E Omega Correct Answer Incorrect Answer

    Solution

    Beta is used to denote the value of volatility of a stock against the market volatility. A high beta means the stock price is more sensitive to news and information, and will move faster than a stock with low beta. In general, high beta means high risk, but also offers the possibility of high returns if the stock turns out to be a good investment.

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