Beta Coefficient
What is it? A measure of a stocks volatility relative to the overall stock market. The beta coefficient of the S&P 500 is 1. Any stock that is more volatile than the market as a whole has a beta value higher than 1. If the beta coefficient is less than 1, the security is considered to be less risky than the market. Conservative investors ideally seek to invest in stocks with low beta coefficients, whereas investors willing to take more risk seek to invest in high-beta stocks.Added By: Abby
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