Securities with betas greater than l should have:
A) greater than average diversifiable risk.:::::
B) lower than average diversifiable risk.
C) required returns higher than the market return.
D) no systematic risk.

Question

Quizplus · Accepted Answer

Securities with betas greater than 1 are more volatile than the market, indicating higher systematic risk, and thus should have required returns higher than the market return to compensate for this increased risk.

Securities with Betas Greater Than L Should Have