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anonymous
 5 years ago
should we consider negative D/E ratio in calculating Levered Beta ?
anonymous
 5 years ago
should we consider negative D/E ratio in calculating Levered Beta ?

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anonymous
 5 years ago
Best ResponseYou've already chosen the best response.0D/E ratio should be market values when calculating levered beta. I don't see how this ratio can be negative

anonymous
 5 years ago
Best ResponseYou've already chosen the best response.0you can consider negative ration only in a short period...never for long period

anonymous
 5 years ago
Best ResponseYou've already chosen the best response.0I assume that you are using net debt and market equity to come to a negative D/E ratio. In that case, it is perfectly consistent to use the negative D/E ratio and end up with a levered beta that is lower than your unlevered beta... (the cash pulls the beta of equity down ...)
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