Levered Beta Calculator
Calculate levered (equity) beta by applying financial leverage to asset beta using the Hamada equation.
Relevering Inputs
CAPM Parameters (for Cost of Equity):
Levered Beta (Equity Beta)
1.100
Cost of Equity: 10.60%
Leverage Impact
Unlevered Beta0.800
Financial Risk Addition+0.300
Leverage Multiplier1.375x
Debt-to-Capital33.3%
Beta & Cost of Equity at Different D/E
| D/E | Beta | Cost of Equity |
|---|---|---|
| 0.00 | 0.800 | 8.80% |
| 0.25 | 0.950 | 9.70% |
| 0.50 | 1.100 | 10.60% |
| 0.75 | 1.250 | 11.50% |
| 1.00 | 1.400 | 12.40% |
| 1.50 | 1.700 | 14.20% |
| 2.00 | 2.000 | 16.00% |
Hamada Formula
βL = βU × [1 + (1 - T) × D/E]
= 0.80 × [1 + (1 - 0.25) × 0.50]
= 0.80 × 1.375
= 1.100
= 0.80 × [1 + (1 - 0.25) × 0.50]
= 0.80 × 1.375
= 1.100