Equity beta: Difference between revisions

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In the Capital asset pricing model (CAPM), the relevant measure of total equity risk.
In the Capital asset pricing model (CAPM), the equity beta is the relevant measure of total equity risk.
 
This total risk results from both:
 
:(i) the underlying business risk and
:(ii) the additional financial risk resulting from the level of debt in the firm’s financial structure (financial gearing).
 
 
The equity beta is also known as Geared beta or Levered beta.


Also known as Geared beta.


== See also ==
== See also ==
* [[Beta]]
* [[Capital asset pricing model]]
* [[Capital asset pricing model]]
* [[Equity]]
* [[Equity risk]]
* [[Equity risk]]
* [[Gearing]]
* [[Ungeared beta]]


[[Category:The_business_context]]
[[Category:Corporate_finance]]
[[Category:Identify_and_assess_risks]]

Latest revision as of 15:24, 9 February 2019

In the Capital asset pricing model (CAPM), the equity beta is the relevant measure of total equity risk.

This total risk results from both:

(i) the underlying business risk and
(ii) the additional financial risk resulting from the level of debt in the firm’s financial structure (financial gearing).


The equity beta is also known as Geared beta or Levered beta.


See also