I've taken three months of price return data for two instruments and calculated a between the two using the formula with the goal of estimating what the percentage change in instrument should be based on what the percentage change in instrument is. I have been applying this by multiplying by the percentage change of to determine a beta-adjusted percentage change for , but I am wondering if I should actually multiply the derived by the current percentage change of instead. Could anyone shed some light on whether or not I am properly applying this to arrive at an expected percentage change for ?

How to apply derived beta to daily change?
jod51

