# variance unsystematic component

I was wondering how to calculate the variance of the unsystematic component in an asset.

For example, if an asset's expected return is 10% with standard deviation of 6% and a beta of zero. What would the variance of the systematic component be? Can I use the CAMP model to find it?

What do you want to calculate now the systematic or unsystematic component?

The equation is total risk = systematic + unsystematic risk. Or more formally: o_i^2 = B_i^2 * o_m^2 + o_e^2 So if you have a beta of zero and want to calculate the unsystematic component it would be equal to the total risk of the asset in your case 0.06^2.