Which one of the following measures the amount of systematic risk present in a particular risky asset relative to the systematic risk present in an average risky asset?
A)beta
B)reward-to-risk ratio
C)risk ratio
D)standard deviation
E)price-earnings ratio

Question

Quizplus · Accepted Answer

Beta measures the systematic risk of an asset by comparing it to the market as a whole, which is considered to have a beta of 1. A beta greater than 1 indicates that the asset is more volatile than the market, while a beta less than 1 indicates that the asset is less volatile. Therefore, beta is a useful tool for investors to decide whether or not to invest in an asset in relation to the systematic risk it presents.

Which One of the Following Measures the Amount of Systematic