Beta measures the volatility of a stock to changes in the market. Or the Beta reflects the risk (systematic portion of risk) of equity. It is a very important measure in finance simply because the cost of capital depends on beta and the entire finance world depends on cost of capital!!
We have tried to explain what beta is visually. We hop this info-graphic is helpful in clarifying what beta means. This is only an initial draft and we hope you will leave feedback so we can keep improving this info-graphic.
Beta in Corporate Finance: Equity beta, Debt beta, Asset beta – An infographic on Betas in Corporate Finance: Equity beta, Debt beta, Asset beta by the finance tutoring team.
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