Question

Beta Questions for Starbucks: Beta is 0.7611231

1. Is your company's beta positive? What does it mean for
investors in that stock? 2) Is your company's beta above 1 in
absolute value? What does it mean for the stock returns? 3) Would
you consider adding the stock to your investment portfolio based on
the beta you found? Why or why not?

Answer #1

1. Yes, the beta is positive. It means the volatility of market changes to our stock is around 76%. if the Industry is going good, then it is not a good investment and if the industry is on fall, then the loss of these stocks would be lesser as compared to the market.

2. This means that our stocks are volatile than the market. if anything changes in industry, we are the first one getting effected whether it is positive or negative.

3. I would add this stock because the company is safer thyan other companies in the market and this would be a good investment being a pessimistic person.

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Analyzing Starbucks' Equity Structure and Financial Position
Using either Starbucks’ most current Form 10-K or the company's
annual report, answer the following questions and prepare a
professionally written financial analysis report and, forward
opinion on Starbucks from the perspective of a portfolio manager.
Base your opinions and recommendation on the fact that you are the
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buy an additional 10,000 shares of...

IV. You currently hold a diversified portfolio with a beta of
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b) Suppose you sell $10,000 worth of Chevron stock (which is
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1. McDowell Company's stock has a beta of 0.9, the risk-free
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c) between zero and 1.
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1. Beale Manufacturing Company has a beta of 1.2, and Foley
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2. Suppose you held a diversified portfolio consisting of a
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You found year over year returns of stock are highly
volatile. Does this mean you should necessarily consider this stock
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stocks:
Expected Return
Standard Deviation
Beta
Stock A
13%
15%
1.6
Stock B
9.2%
25%
1.1
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C. In a regression with individual asset’s return as the
dependent variable and the market’s return as the independent
variable, the R-squared value is higher for Asset 1 than it is for
Asset 2.
D. All of...

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