Examlex
Use the following information to answer the question(s) below.
Suppose that the market portfolio is equally likely to increase by 24% or decrease by 8%.Security "X" goes up on average by 29% when the market goes up and goes down by 11% when the market goes down.Security "Y" goes down on average by 16% when the market goes up and goes up by 16% when the market goes down.Security "Z" goes up on average by 4% when the market goes up and goes up by 4% when the market goes down.
-The beta for security "Y" is closest to:
Collar
A protective options strategy that involves buying a put option and selling a call option on the same asset to limit the range of possible returns.
Putable Bond
A type of bond that allows the holder to sell the bond back to the issuer at a predetermined price before maturity.
Floating Rate
An interest rate that changes over time as it is tied to an underlying benchmark or index, commonly used in loans and bonds.
Bond Indenture
A legal contract between a bond issuer and bondholders, detailing the terms and conditions under which a bond is issued, including the interest rate, maturity date, and covenants.
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