How to Calculate Beta with Excel, Calculation of Beta

Chapters/ Timestamps:

00:00 Intro to Beta Calculation 📊
00:57 Data Collection Process 🔍
01:47 Accessing NSE Historical Data 📈
04:11 Preparing Nifty Data in Excel 🧾
06:23 Retrieving Colgate Stock Data 🏢
09:30 Data Verification and Cleanup 🧹
11:42 Calculating Daily Returns 📉
15:04 Applying the Slope Function for Beta 📐
17:12 Interpreting Beta Values 🧠
17:52 Beta Variations Across Industries 🏭

How to calculate the Beta of a stock in Excel. Read the text version here: financewalk.com/equity-research-interview-quest…

If you go for an interview for the post of equity research analyst, you'll face the question: "How to calculate Beta value?"
As an equity research analyst, you need to know how to calculate the Beta of a stock. To find the Beta of stocks, you need two steps:
1. Data collection:
Here you'll collect the closing price of the stock and the closing price of the benchmark index.
2. Calculate stock Beta in Excel:
In this step, you'll understand how to calculate market Beta.
I've explained the first part (data collection) of the process How to Calculate Beta of a Stock Using Excel in the video

In the data collection part, I covered how to collect the closing price of the stock and the closing price of the benchmark index.
Calculate stock Beta in Excel using SLOPE function
In this video post, we are going to see how to calculate stock Beta in Excel using the SLOPE function.
I've explained the second part (how to calculate beta in Excel) of the process How to Calculate the Beta of a Stock Using Excel in the video.

Diversification and Beta
We diversify the portfolio to reduce total risk. By doing this, the only systematic risk remains. Beta is used to measure systematic risks. A conservative investor would look for the beta of 0.5 whereas an aggressive trader would look for the betas around 1.5. If one is looking for reducing total risk, he should go for a good diversification strategy instead of lower betas.

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