- CFA Exams
- CFA Level I Exam
- Topic 9. Portfolio Management
- Learning Module 2. Portfolio Risk and Return: Part II
- Subject 4. Calculation and Interpretation of Beta
CFA Practice Question
The estimate of beta depends upon the ______.
II. market proxy used for M
III. number of observations used
I. time period used for estimation
II. market proxy used for M
III. number of observations used
Correct Answer: I, II and III
Each of these issues is not addressed in the theory, but they all affect the actual estimate of beta.
User Contributed Comments 1
| User | Comment |
|---|---|
| edushyant | Probably length of period (I) is of importance. If the data over short time period is used, beta estimates may be affected by special events during that period. |