Beta measures depend highly on the:
A)direction of the market variance.
B)overall cycle of the market.
C)variance of the market and asset, but not their co-movement.
D)covariance of the security with the market and how they are correlated.
E)All of the above.

Question

Quizplus · Accepted Answer

Beta measures depend on the covariance of the security with the market and how they are correlated, as beta reflects the sensitivity of an asset's returns to those of the market. The other options may have some impact on beta, but they are not the primary drivers.

Beta Measures Depend Highly on The