HomeDefinitionsCompareDebt Beta equation (security)The financial definition for Beta equation (security):The market beta of a security is determined as follows: Regress beta of stock y on excess returns of the market. The slope coefficient is beta. Define n as number of observation numbers. Beta= [(n) (sum of [xy]) ]-[ (sum of x) (sum of y)]/ [(n) (sum of [xx]) ]-[ (sum of x) (sum of x)] where: n = # of observations (usually 36 to 60 months) x = rate of beta for the S&P 500 index y = rate of return for the security. Related: beta Similar MatchesRegression equationRegression equationAn equation that describes the average relationship between a dependent variable and a set of explanatory variables. Click to compare definitions of Beta equation (security) Click to view definitions beginning be |