Estimating a beta (Corporate Finance)
  • Estimating a beta (Corporate Finance)
Originally published: 20/06/2016 12:26
Last version published: 25/10/2016 08:18
Publication number: ELQ-37738-3
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Estimating a beta (Corporate Finance)

Compute and estimate a beta for a firm's stock/market index

betaestimatingfinancejensen's alphamarket indexperformancerisksensitivitystock

Description
This spreadsheet allows you to input past returns on a stock and a market index to analyse its price performance (Jensen's Alpha), its sensitivity to market movements (Beta) and the proportion of its risk that can be attributed to the market.

Note: this model is being shared with the authorization of Professor Aswath Damodaran from NYU Stern Business School (www.damodaran.com)

This business tool includes
1 Excel Model File

Prof. Aswath Damodaran offers you this business tool for free!

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Further information

The objective of this model is to get the following output values:

to estimate expected returns:
- risk free rate
- historical return premium
- expected return

to forecast prices:
- current price
- annualized DPS

- predicted prices (one to five years from now)

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