The best stock to own when the stock market is at a peak and is expected to decline in value is one with a beta of
A) +1.5.
B) +1.0.
C) -1.0.
D) -0.5.

Question

Quizplus · Accepted Answer

A stock with a beta of -1.0 would be expected to move in the opposite direction of the market. Therefore, if the market is expected to decline, a stock with a beta of -1.0 would be expected to increase in value, making it the best choice under these conditions.

The Best Stock to Own When the Stock Market Is