Beta is directly related to market movement. Notably, high beta stocks tend to rise or fall more than the stock market and are thus more volatile. A beta of more than 1 indicates that the price Beta is a multiplicative factor. A stock with a beta of 2 relative to the S&P 500 goes up or down twice as much as the index in a given period of time. If the beta is -2, then the stock moves in the opposite direction of the index by a factor of two. A beta coefficient is a measure of the volatility, or systematic risk, of an individual stock in comparison to the unsystematic risk of the entire market. In statistical terms, beta represents the slope of the line through a regression of data points from an individual stock's returns against those of the market.

In finance, the beta of an investment is a measure of the risk arising from exposure to general It is a useful tool in determining if an asset being considered for a portfolio offers a reasonable expected return for risk. Higher- beta stocks tend to be more volatile and therefore riskier, but provide the potential for higher returns. High-beta stocks are supposed to be riskier but provide higher return potential; X. Company X has been considered a defensive stock with a low beta. When it  14 Jan 2020 High beta stocks are those that are positively correlated with returns of the S&P 500, but at an amplified magnitude. Because of this amplification,  21 Aug 2014 High-beta stocks are often considered risky, and at times they are. However, investors should understand the difference between risk and beta,  9 Feb 2016 Capital asset pricing model (CAPM), which is used to calculate the cost of equity, majorly depends on beta. A stock that has a market value above 1.0 is  22 Jan 2020 See the 100 highest beta stocks in the S&P 500. High beta stocks should have stronger returns during bull markets (and lower returns during 

Notably, high beta stocks tend to rise or fall more than the stock market and are thus more volatile. A beta of more than 1 indicates that the price tends to move higher than the broader market

15 Jun 2018 The slope of these lines is these stocks' beta. X is a very high-beta stock and ED is a very low-beta one. The point at which they cross the y-axis is  10 Mar 2016 The secret sauce behind high performance is low volatility. Stock portfolios built with low beta stocks tend to outperform high-beta growth stocks  15 Jun 2012 In the CAPM, beta is the measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. High-beta  13 May 2016 That is, will high-beta stocks yield a higher return than low-beta stocks? And what happens to beta over time? Is high or low beta sustained? If an  A high beta index is a basket of stocks that exhibit greater volatility than a broad market index like the S&P 500. The S&P 500 High Beta Index is the most well-known of these indexes. It tracks the performance of 100 S&P 500 companies that are most sensitive to changes in market returns. High beta stocks may indicate a history of frequent movement in opposition to the overall stock market. These types of stocks are generally volatile and can throw off investors who do not have experience riding market waves—that is, knowing when to buy and sell. High beta stocks are those that are positively correlated with returns of the S&P 500, but at an amplified magnitude. Because of this amplification, these stocks tend to outperform in bull markets,

If a stock has a beta of 1 it generally will move up and down in the same increment as the index that it is aligned with. (Most websites use the S&P 500 as the index). If the beta is less than one it will not be as volatile as the market. If the beta is 2 it move greater than the market - both up and down.

Fast-paced tech stocks tend to have high betas, though bigger and better-established tech stocks shouldn’t be seeing betas higher than 4 because of their bigger and better-established nature in their chosen sectors. Having said this, neither a low beta nor a high beta should be considered a bad thing on its own. High beta stocks can be great investments in bull markets since they are expected to outperform the S&P 500 by a marginal amount. They do however require a great deal of active management due to their market sensitivity. Thus, in the case of a bear market reversal these stocks could also be expected to lose the most, The five stocks we’ve looked at offer investors high Beta scores along with very strong prospective returns. For investors who want to take some additional risk in their portfolio, these names and others like them in our list of the 100 best high Beta stocks can help determine what to look for when selecting a high Beta stock to buy. If a stock has a beta of 1 it generally will move up and down in the same increment as the index that it is aligned with. (Most websites use the S&P 500 as the index). If the beta is less than one it will not be as volatile as the market. If the beta is 2 it move greater than the market - both up and down.

Stocks with low beta values generate lower returns in bull markets, but could also outperform in a bear market. These 100 stocks have low beta values. Sure Dividend. High-Quality Dividend Stocks, Long-Term Plan The Sure Dividend Investing Method Member's Area The 100 Lowest Beta Stocks In The S&P 500.

High beta stocks may indicate a history of frequent movement in opposition to the overall stock market. These types of stocks are generally volatile and can throw off investors who do not have experience riding market waves—that is, knowing when to buy and sell.

A stock with a beta above 2 -- meaning that the stock will typically move twice as much as the market does -- is generally considered a high-beta stock. High betas are typical of small, speculative companies -- e.g., biotech companies that are developing new treatments and small tech stocks with hot new technologies

In finance, the beta of an investment is a measure of the risk arising from exposure to general It is a useful tool in determining if an asset being considered for a portfolio offers a reasonable expected return for risk. Higher- beta stocks tend to be more volatile and therefore riskier, but provide the potential for higher returns. High-beta stocks are supposed to be riskier but provide higher return potential; X. Company X has been considered a defensive stock with a low beta. When it  14 Jan 2020 High beta stocks are those that are positively correlated with returns of the S&P 500, but at an amplified magnitude. Because of this amplification, 

Fast-paced tech stocks tend to have high betas, though bigger and better-established tech stocks shouldn’t be seeing betas higher than 4 because of their bigger and better-established nature in their chosen sectors. Having said this, neither a low beta nor a high beta should be considered a bad thing on its own.