Beta is defined as the:

A) Slope of the security market line.
B) Amount of systematic risk in a risky asset relative to that in an average asset.
C) Ratio of unsystematic risk in a risky asset relative to the systematic risk in the overall market.
D) Ratio of the total risk in a risky asset relative to the systematic risk in the overall market.
E) Amount of systematic risk in a risky asset relative to that of a risk-free asset.

Beta

A scale for calculating the instability, or regular risk, of a security or combined investments relative to the market in its entirety.

Systematic Risk

The risk inherent to the entire market or market segment, not reducible through diversification.

Security Market Line

A line on a chart that displays the relationship between risk and the expected return of the market portfolio. It serves as a graphical representation of the Capital Asset Pricing Model (CAPM).