| Abstract: | ![]()
Various researchers have decomposed the firm's beta (or systematic risk) into components that are reflective of the firm's corporate characteristics, for example, leverage position, product mix, etc. In this paper, the theoretical beta decompositions of Hamada (1969 and 1972) and Rubinstein (1973) are sub- jected to empirical examination for a sample of diversified (or multi-activity) firms. The results of the analysis evidence highly significant empirical support for the Hamada- Rubinstein model and for the viability of operationalizing that model with available accounting and market data. |
