How to use Beta

Beta indicates the stock’s volatility in relation to the market. In general, a beta less than 1 indicates that the investment is less volatile than the market, while a beta more than 1 indicates that the investment is more volatile than the market. For example, if a stock’s beta is 1.25, it’s theoretically 25% more volatile than the market. Conversely, if stock’s beta is 0.6, it is theoretically 40% less volatile than the market.
Continue reading