BIf you found a stock with a zero historical beta and held it as the only stock in your portfolio, you would by definition have a riskless portfolioCThe beta coefficient of a stock is normally found by regressing past returns on a stock against past market returns. One could also construct a scatter diagram of returns on the stock vs. those on the market, estimate the slope of the line of best fit, and use it as beta However, this historical beta may differfrom the beta that exists in the futureDThe beta of a portfolio of stocks is always larger than the betas of any of the individual stocksEIt is theoretically possible for a stock to have a beta of 1.0. If a stock did have a beta of 1.0, then, at least in theory, its required rate of return would be equal to the risk-free (default-free) rate of return, rRFQUESTION:3[QUESTION BANK ID:269506]CORRECTWhich of the following statements is correct? TYPE:MULTIPLE CHOICE<< HIDE ANSWERSBC
