The market portfolio would have a beta of:
A)0
B)1
C).-1
D)0.8

Question

Quizplus · Accepted Answer

The market portfolio by definition has a beta of 1, because it represents the overall market and serves as the benchmark for measuring the risk and return of other stocks or portfolios. A beta of 0 would mean no correlation with the market, and a beta of 0.8 would imply less sensitivity to market movements than the average stock. The formula provided in option C is not relevant to this question.

The Market Portfolio Would Have a Beta Of