The correct answer is: B. adjusted betas.
A beta is a measure of a stock’s volatility relative to the market. A beta of 1 means that the stock moves in the same direction as the market, while a beta of greater than 1 means that the stock is more volatile than the market and a beta of less than 1 means that the stock is less volatile than the market.
An adjusted beta is a beta that has been adjusted for factors such as changes in the company’s business or the market environment. Adjusted betas are often used by investors to make more informed investment decisions.
The formula 0.67(Historical Beta) + 0.35(1.0) is used to calculate an adjusted beta. This formula takes into account the company’s historical beta and the current market environment. The 0.67 coefficient reflects the fact that historical betas are typically a good predictor of future betas, while the 0.35 coefficient reflects the fact that the market environment can also have a significant impact on a company’s beta.
The other options are incorrect because:
- Historical betas are not adjusted for changes in the company’s business or the market environment.
- Standard betas are not adjusted for changes in the company’s business or the market environment.
- Varied betas are not a standard term in finance.