A positive relationship between the expected return on a security and its beta is justified because there is likely to be a positive discrepancy between the market's return and the risk-free rate.
What do you mean by the significance of the beta coefficient explain it?
The beta coefficient calculates the likelihood that the price of a stock or security will fluctuate in response to changes in the market price. A stock or security's beta can also be used to calculate the systematic risks connected to investment.
What is the significance of the beta coefficient concerning the risk of security?
A stock's volatility can be compared to the systematic risk of the entire market using a beta coefficient. The slope of a line through a regression of data points is known statistically as beta.
Learn more about the relationship between the expected return on a security and its beta: https://brainly.com/question/24000487
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