is it over market variance in both calculations? Or is it standard deviation in the (correlation coefficient)*(standard dev m)*(standard dev x) __________________________________________ standard dev m? or variance of m? the other one is cov x,m --------- Var m
Variance is your denominator in both…it’s the same formula. Your numerator cov=Corr(std.)(std.)
beta = [(Cor) ( Std. X )] / (std. Mkt) beta = (Cor * Std. X * Std. Mkt) / (Var. Mkt)
cov/variance or correlation*stdX*Std market/variance same formula
poulin - good point. Heh
You’re just able to cancel one lot of market std dev from top and bottom to get from one first formula to the next