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Fundamental beta |
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Definition of Fundamental betaFundamental betaThe product of a statistical model to predict the fundamental risk of a security using not
Related Terms:Fundamental descriptorsIn the model for calculating fundamental beta, ratios in risk indexes other than Risk indexesCategories of risk used to calculate fundamental beta, including (1) market variability, (2) BetaA measure of the riskiness of a specific security compared to the BetaThe price volatility of a financial instrument relative to the price betaSensitivity of a stock’s return to the return on the market Beta coefficientA measurement of the extent to which the returns on a given stock move with stock market. Beta equation (Mutual Funds)The beta of a fund is determined as follows: Beta equation (Stocks)The beta of a stock is determined as follows: Beta (Mutual Funds)The measure of a fund's or stocks risk in relation to the market. A beta of 0.7 means Beta riskRisk of a firm measured from the standpoint of an investor who holds a highly diversified portfolio. Country betaCovariance of a national economy's rate of return and the rate of return the world economy Expected return-beta relationshipImplication of the CAPM that security risk premiums will be Foreign market betaA measure of foreign market risk that is derived from the capital asset pricing model. Fundamental analysisSecurity analysis that seeks to detect misvalued securities by an analysis of the firm's fundamental analystsAnalysts who attempt to find under- or overvalued securities by analyzing fundamental information, such as earnings, asset values, and business prospects. Leveraged betaThe beta of a leveraged required return; that is, the beta as adjusted for the degree of Unleveraged betaThe beta of an unleveraged required return (i.e. no debt) on an investment when the Zero-beta portfolioA portfolio constructed to represent the risk-free asset, that is, having a beta of zero.
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