Expected return remains unchanged. However, if the beta is 1, the security's expected return is equal to the market's average return.
A beta of 1 indicates that the security's price tends to move with the market. A beta greater than 1 indicates that the security's price tends to be more volatile than the market. A beta less than 1 means it tends to be less volatile than the market. The expected rate of return is calculated by multiplying the potential outcomes by the probabilities of them occurring and then summing those outcomes. Expected returns cannot be guaranteed. The expected return for a portfolio containing multiple investments is the weighted average of the expected returns for each investment.
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