Beta Calculation on Excel
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youve explained it really well, thanks
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This is really helpful. Thank you so much.
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U R GOD
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I LOVE YOU <3
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Thanx Thanx Thanx Dude :)
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Thanx Thanx Thanx Dude
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Thumbs up if Nauman Amin sent you here :P
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This was more helpful than my actual professor. Thank you so much for the upload
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To answer a couple of questions. If you use the formulas Covar/Var you'll get a slightly different answer because the var and covar functions use "n-1" weighting. That is, they are calculating the "unbiased estimate of the variance of the sample" rather than the sample variance. The regression coefficient is calculated using the sample variance. If the sample is very large you'll get almost exactly the same values.
pdaves 3 months ago
hey ,, it's actually like ur answering my assignment (: so thank u was really useful info. im just wondering if there are any differences (as i never done finance), between calculating beta and doing regression? because the question i got is .. estimate beta coefficients for A company and the lecturer told us to do regression first..
alaser66 1 year ago
@alaser66
This is the same as regression. The =SLOPE function is just an easier way of doing regression.
pdaves 10 months ago
two questions.
1.why didnt you include any riskfree rates in your calculation ? ( R-Rf=a+b(Rm-Rf)+e)
2.when I calculate the beta with the two ways, you explained very well, I attain a beta from the slope calculation that is slightly different from the regression calculation. Do you know any other reason than just me doing it wrong haha ?
very good explanation ;). thanks for that!
malkidash 1 year ago
@malkidash
The regression where you subtract off the risk free rate from the stock on the LHS, and from Rm on the RHS is the preferred method in finance. However, IF the risk free rate is uncorrelated with the market and with the stock, then it won't affect the expected value of the slope coefficient. So, since daily risk free data is a bit of a pain to download and put in the spreadsheet, I didn't use it. If you do subtract, then theory says you should run the regression without intercept.
pdaves 10 months ago