Beta Stock Finance

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[The CPI Card Group Stock Analysis]
Introduction
CPI Card Group, Inc. participates in scheming, manufacturing, branding, packaging, and tracking of smart cards. It emphasizes on providing commercial, marketable, and credential card production and related services. The CPI Card Group Inc. made an IPO filing on August 7, 2015, for $100m. The company also participates in offering different products as well as services and is located in United States, United Kingdom, and Canada. The company provides services for banks, retailers, the government, security and entertainment groups. Members are from the United States as well as internationally. This paper seeks to analyze CPI Card Group stock values using regression with ANOVA using it stock values given from 19th November 2017 to 1st February 2018.
Calculations
A regression on daily group returns of the CPI Card Group as at November 19th, 2017 up to 1st February 2018
Regression Statistics          
Multiple R 0.28502          
R Square 0.08123          
Adjusted R Square -0.04126          
Standard Error 3.979          
Observations 16          
     
       
ANOVA            
  dfSS MS F Significance F  
Regression 1 21 10.5 0.66315 0.529691  
Residual error 15 237 15.33333      
Total 16 238        
             
  Coefficients Standard Error t Stat P-value Lower 95% Upper 95%
Intercept 14 1.6244 8.618218 3.402E-0 10.7435 17.4624
Returns 1.63091 0.47583 3.

5797 0.003403 0.57471 2.87665
Assumptions of the analysis remain that the data is typically distributed and reliable. The probability value applied is 95%. Hence there exists high certainty that the true beta is actually higher than one. Since in our first case we have fewer observations than the second, with a confidence interval of 95%, the medium values are almost the same. The first beta is 1.03 and 2.456 which assures that our beta value is higher than one.
The repeated regression using the same period as the daily regression November 19th, 2017 up to 1st February 2018
Regression Statistics          
Multiple R          
R Square 0.617178          
Adjusted R Square 0.25193          
Standard Error 2.2221          
Observations 24          
             
ANOVA            
  dfSS MS F Significance F  
Regression 1 6649.88 1329.873 2.9533 0.032374  
Residual 23 10808 450.33      
Total 24 17457.86        
             
  Coefficients Standard Error t Stat P-value Lower 95% Upper 95%
Intercept 165.4 9.4903 17.428 3.968E-15 145.81 184.98
Returns 1.034561 0.76543 1.17654 0.43527 -0.543276 2.67543
The range in the two regressions tends to show an overlapping behavior which makes it difficult to define what the actual value of the beta is drifting. The beta measured using the daily data is lower than the monthly data (Chatterjee and Simonoff ). This can be deduced by the fact that during the closing time for a stock the closing price may have only taken few minutes in the market. Therefore, during the duration that we could be measuring the stock price trading, is the same time we consider as stock close in daily returns calculations.
Conclusion
The CPI CARD Group data indicates that the beta value is above 1.0 then the investment is more volatile than in the stock market. In our case, the beta is 1.03. Hence there exists a fair degree of stability in the market prices (Chatterjee and Simonoff ). Since our Beta is positive, the stock price is moving in the same direction as the market. In our case, the Beta is more significant than one hence when the market index goes up by 1% then the beta will go up by more than 1%.
Work cited
Chatterjee, Samprit, and Jeffrey S. Simonoff. Handbook of Regression Analysis. Wiley, 2013.