The difference between beta and standard deviation is best described as: a.Beta
ID: 2680779 • Letter: T
Question
The difference between beta and standard deviation is best described as:
a.Beta measures the risk of the market as a whole, while standard deviation measures the risk of individual stocks.
b.Beta measures total volatility, while standard deviation measures total risk.
c.Beta measures the market risk premium, while standard deviation measures risk.
d.Beta measures the risk investors are compensated for, while standard deviation measures both systematic and unsystematic risk.
I think the correct answer is d, is that right?
Explanation / Answer
d.Beta measures the risk investors are compensated for, while standard deviation measures both systematic and unsystematic risk.
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