We will generally find that the beta of a single security is more stable over time than the beta of a diversified portfolio.

Question

Quizplus · Accepted Answer

The beta of a single security can be affected by company-specific events and changes in market conditions, making it more volatile and less stable over time. On the other hand, the beta of a diversified portfolio is typically more stable as it is influenced by the overall market trends rather than specific company factors.

We Will Generally Find That the Beta of a Single