Yes when you just take average beta you will get the levered beta.

The formula to calculate unlevered beta is βL = βU + [1 + (1 - t)(d/e)]

T is tax rate of the company

d/e is the debt-equity ratio of the company

by doing this you eliminate the effect of debt on the capital structure of the company.

Jun 28 2013 10:13 AM
The formula to calculate unlevered beta is βL = βU + [1 + (1 - t)(d/e)]

T is tax rate of the company

d/e is the debt-equity ratio of the company

by doing this you eliminate the effect of debt on the capital structure of the company.