Accounting and Finance group project Accounting, Finance, SPSS Essay

1 Introduction
There is always a degree of volatility in every stock in the market. Beta is a measurement that shows the relationship between the movement of a stock to the movement of the market.  A simpler explanation is Beta being a measurement of how a stock would move, when the market moves. Higher Beta would mean more market sensitivity, while lower Beta stocks would mean lower market sensitivity.
2 Company
Costco Wholesale is an in-store retailer with various membership warehouses and the retailer sells nationally branded and private-label merchandise at low prices. Costco is headquartered in Issaquah, Washington, the US. The company sells its products and offers a range of consumer services such as insurance plans, mortgages and refinancing solutions, cash cards, and credit card processing services. The portfolio of products includes appliances, groceries consumer electronics, computers, computers accessories, a variety of appliances, groceries, consumer health and beauty products, and other products in the US and the international market. Like other companies in the retail store industry, the company’s earnings and stock performance are closely linked to consumer spending. The warehouse club operator’s stock changes are still influenced by customers’ decisions to shop there, preference for other stores or online shopping.
3 Beta
As Beta measures volatility/ systematic risk, it gives us an idea of Costco’s stock movements in the market. Year 3 has a negative Beta of -0.0109948 or -.01 rounded. Year 5 has a Beta of -.0.154676 or -.15 rounded. There isn’t really big difference because both the Betas are negative. Negative Beta’s have an inverse relationship with the market. If the S&P 500 was dropping, Costco’s stock would go up. Depending on what you wanted to do, you would pick either 3 year or 5 year. Short term would use the 3 year, long term would use the 5 year.
4 Intercept
Intercept measures how a variable would impact output. In our case, it would mean how the S&P500 would impact the outcome of Costco’s stock. Year 3 had an intercept of .024703 or .02 rou...