The rate of rate on the stock of Omega Electronics and on the market portfolio for 6 periods has been as follows:

Period Return on the stocks of Omega electronics Return on market Portfolio

1 18% 15%

2 10% 12%

3 -5% 5%

4 20% 14%

5 9% -2%

6 18% 16%

a) What is the beta of the stock of Omega Electronics?

b) Determine the characteristics line for the stock of Omega Electronics.

Answer rating: 100% (QA)

To calculate the beta of the stock of Omega Electronics we first need to calculate the covariance and variance of the returns of Omega Electronics and the market portfolio Then we can use these values ... View the full answer