BETA EQUATION (MUTUAL FUNDS)

Beta equation (Mutual Funds): translation

The beta of a fund is determined as follows:

(( n) (sum of (xy)) )-((sum of x) (sum of y))

(( n) (sum of (xx)) )-((sum of x) (sum of x))

where: n = numder of observations (36 months)

x = rate of return for the S&P 500 Index

y = rate of return for the fund

The New York Times Financial Glossary