Market Cap : 28.39 B | Enterprise Value : 33.62 B | P/E (TTM) : 38.30 | P/B : |
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Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. As of today (2021-01-16), Otis Worldwide's Beta is Not available.
* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.
* The bar in red indicates where Otis Worldwide's Beta falls into.
Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. A stock's beta can be calculated by dividing the product of the covariance of the individual stock's returns and the market's returns by the variance of the market's returns over a specified period. Basically, GuruFocus uses the returns calculated over three-year period.
Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. We usually compare beta to 1. A beta of 1 indicates that the security's price will move with the market. A beta of less than 1 means that the security will be less volatile than the market. A beta of greater than 1 indicates that the security's price will be more volatile than the market.
Beta is primarily used in the Capital Asset Pricing Model (CAPM) to calculate the Cost of Equity, which can be used in the calculation of WACC %. The formula of Cost of Equity is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
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