Using Hyperlinks To Create A Lecture On Calculating Beta And The Beta Coefficient For Dow Chemical Company

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Nakita Harper
Keshawna Jordan
Carl B. McGowan Jr
Benjamin J. Revello

Keywords

beta coefficient, Power Point, CAPM, market model

Abstract

In this paper, we show hyperlinked Power Point lecture slides that show how to calculate the beta coefficient for Dow Chemical Company using the S&P 500 as the market index.   This paper shows how to collect data for both Dow Chemical and for the S&P 500 Stock Index, how to calculate monthly returns, and how to run a regression to calculate the beta.  The data for both Dow Chemical and for the S&P 500, fifty-one month end prices including dividends, are down loaded from Yahoo! Finance and loaded into an Excel worksheet which is used to calculate monthly returns.  The fifty monthly returns are regressed with the S&P Index return as the independent variable and the Dow returns as the dependent variable.  The returns are graphed to check that the analyst ran the regression properly.

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