SIE Exam Practice Question 983
Question: 983
A stock with a beta of -1.5 and a standard deviation of 10.1 will change in which of the following ways if the stock market increases 8%?
Correct Answer: D
Explanation:
8% × -1.5 = -12%
A stock with a beta of -1.5 will move 150% in the opposite direction of the market. Therefore, if the stock market increases by 8%, the stock will decrease by 12%.
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