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Technology Stocks : Dell Technologies Inc.
DELL 133.59-1.8%Dec 3 3:59 PM EST

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To: Don Martini who wrote (57724)8/11/1998 8:09:00 PM
From: Chuzzlewit  Read Replies (2) of 176387
 
Okay guys, here's your finance lesson for the day. If you plot the holding period rate of return of a stock (calculated as the sum of the ending price plus dividends received less the beginning price divided by the beginning price) against the holding period rate of return of a broad based average such as the S&P500 monthly over several years, and you calculate a least squares straight line fit through those points, the slope of the regression line is the beta and the y-intercept is the alpha. The beta is commonly interpreted as the volatility of the stock relative to the market. The problem is that betas are not stable over time.

Hope this helps.

TTFN,
CTC
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