# Beta and the Assumption of IID Returns

For two stocks that are independent and identically distributed (iid), do they have the same beta? Does the number of data points matter?

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For two stocks that are independent and identically distributed (iid), do they have the same beta?

No. If you have two stocks perfectly negatively correlated, then ones' beta would be positive, and the other's - negative, as long as the beta is not zero.

Does the number of data points matter?

No, as long as your statistics are significant.

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Meant to say independently. Trying to say that the stock returns are IID. –  user7401 Mar 1 '14 at 2:19
by beta do you mean beta to the market? e.g. S&P returns? –  Aksakal Mar 1 '14 at 2:39
Yes. I do mean the beta to the market. –  user7401 Mar 1 '14 at 6:47
This answer would be improved by an explanation of what iid means and how it relates to each part. –  John Mar 3 '14 at 14:50
How can they be perfectly negatively correlated and independent? –  nsw Apr 15 '14 at 6:42