Asset beta: Difference between revisions
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imported>P.F.cowdell@shu.ac.uk m (Categorise page) |
imported>Doug Williamson (Clarify.) |
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The beta value for the securities issued by a company | The observed beta value for the securities issued by a company incorporates both financial and business risk. | ||
The asset beta is calculated from the observed beta; to reflect the beta value which would be observed if the company were all equity financed. It is therefore indicative of the business risk of the company. | The asset beta is calculated from the observed beta; to reflect the beta value which would be observed if the company were all equity financed. It is therefore indicative of the business risk of the company. | ||
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* [[Ungeared beta]] | * [[Ungeared beta]] | ||
[[Category:Corporate_finance]] | [[Category:Corporate_finance]] | ||
Revision as of 10:31, 18 April 2015
The observed beta value for the securities issued by a company incorporates both financial and business risk.
The asset beta is calculated from the observed beta; to reflect the beta value which would be observed if the company were all equity financed. It is therefore indicative of the business risk of the company.
The asset beta is also called the ungeared beta.
