The Security Characteristic Line (SCL)
A)plots the excess return on a security as a function of the excess return on the market.
B)allows one to estimate the beta of the security.
C)allows one to estimate the alpha of the security.
D)all of the above.
E)none of the above.

Question

Quizplus · Accepted Answer

The Security Characteristic Line (SCL) plots the excess return on a security as a function of the excess return on the market, allowing one to estimate the beta of the security and the alpha of the security. Therefore, all of the options are correct.