How to calculate the beta (β) of individual stocks in a portfolio (Tesla example)

In this video, we dive deep into solving for an individual stock's beta using the Capital Asset Pricing Model (CAPM) and portfolio theory. Through a practical example, we calculate the portfolio beta for a fund consisting of Microsoft, PepsiCo, Apple, and Tesla, each with different investments. You'll learn how to apply the SML (Security Market Line) and beta formulas, using market data and the fund's required rate of return to solve for the missing beta of Tesla. This video covers essential steps that you can use for exam preparation or real-world financial analysis.

Previous

How to calculate the beta (β) of individual stocks in a portfolio (Apple example)

Next

How to calculate the beta (β) of individual stocks in a portfolio (PepsiCo example)