| Article ID: | iaor201522776 |
| Volume: | 7 |
| Issue: | 3 |
| Start Page Number: | 243 |
| End Page Number: | 254 |
| Publication Date: | Sep 1984 |
| Journal: | Journal of Financial Research |
| Authors: | Duvall Richard M, Cheney John M |
| Keywords: | investment, government, behaviour, statistics: empirical, risk |
The purpose of this paper is to investigate the relationship between bond betas and default risk. Previous studies conclude that there is an apparent lack of a significant and direct relationship and offer various explanations. This paper illustrates that beta is influenced by offsetting or conflicting factors that cause the relationship to be ambiguous. Empirical evidence confirms the explanation.