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  3. 1.standard deviation and beta both measure risk, b

1.Standard deviation and beta both measure risk, but they are different in that ...

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Finance

1.Standard deviation and beta both measure risk, but they are different in that

Beta measures only systematic risk while standard deviation is a measure of idiosyncratic risk.

Beta measures only unsystematic risk while standard deviation is a measure of total risk.

According to CAPM, beta is priced while standard deviation is not fully priced.

Both beta and standard deviation are fully priced, according to CAPM

None of the above

2.

  1. You estimate an index model for Stock A using the market excess return. The estimate beta is -1.1. The standard deviation of market return is 5% and the standard deviation of Stock As return is 8%. What is the R-squared of Stock A using this single index model?

    47.3%

    76.6%

    -62.5%

    100%

    None of the above

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