The beta of a company after subtracting out the impact of its debt obligations. Unlevered beta removes the effects of the use of leverage on the capital structure of a firm, since the use of debt can result in tax rate adjustments that benefit a company. Removing the debt component allows an investor to compare the base level of risk between various companies. It is calculated by dividing the levered beta by [1 + (1 - tax rate) x (D / E)], where D/E is the debt/equity ratio.
Related information about unlevered beta:
- Unlevered Beta Definition | Investopedia
A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta of a company without any debt.
- What are the formulas for unlevering and levering - IBankingFAQ
What are the formulas for unlevering and levering Beta? Unlevered Beta = Levered Beta / (1 + ((1 – Tax Rate) x (Debt/Equity))). Levered Beta = Unlevered Beta x ...
- How to Calculate Unlevered Beta | eHow.com
How to Calculate Unlevered Beta. A company's beta is a numerical measure of how closely correlated a company's shares are to the stock market as a whole.
- LEVERED AND UNLEVERED BETA - IESE Business School
and the unlevered beta (βu) of a company depends upon the financing strategy. ... relationship between the levered beta and the unlevered beta (Harris and ...
- Unlevered Beta - Financial Dictionary - The Free Dictionary
What Does Unlevered Beta Mean? A type of metric that compares the risk of an unlevered company with the risk of the market in general; the unlevered beta is ...
- Unlevered Beta - What is the Definition and Formula? - Asset Beta ...
Dec 16, 2011 ... http://www.subjectmoney.com http://www.subjectmoney.com/definitiondisplay. php?word=Unlevered%20Beta The unlevered beta (asset beta) ...
- What is unlevered beta? definition and meaning
Definition of unlevered beta: The beta of a company after subtracting out the impact of its debt obligations. Unlevered beta removes the effects of the use of ...
- Levered vs. Unlevered Beta | Wall Street Oasis
Mar 18, 2008 ... Read forum discussions about Levered vs. Unlevered Beta on Wall Street Oasis, the largest finance industry social network and web ...