[{"data":1,"prerenderedAt":586},["ShallowReactive",2],{"term:beta":3},{"term":4,"related":577},{"id":5,"title":6,"body":7,"category":557,"description":558,"extension":559,"faq":560,"meta":564,"navigation":565,"path":566,"related":567,"seo":570,"stem":571,"takeaways":572,"__hash__":576},"terms\u002Fterms\u002Fbeta.md","Beta",{"type":8,"value":9,"toc":550},"minimark",[10,15,19,22,26,397,543,547],[11,12,14],"h2",{"id":13},"understanding-beta","Understanding Beta",[16,17,18],"p",{},"A beta of 1 means a stock tends to move with the market. Above 1 means larger swings; below 1 means smaller ones.",[16,20,21],{},"Beta is estimated from past returns, so it describes history rather than guaranteeing future behavior. It measures market risk only, not risks specific to the company.",[11,23,25],{"id":24},"formula","Formula",[27,28,31],"span",{"className":29},[30],"katex-display",[27,32,35,119],{"className":33},[34],"katex",[27,36,39],{"className":37},[38],"katex-mathml",[40,41,44],"math",{"xmlns":42,"display":43},"http:\u002F\u002Fwww.w3.org\u002F1998\u002FMath\u002FMathML","block",[45,46,47,114],"semantics",{},[48,49,50,54,58],"mrow",{},[51,52,53],"mi",{},"β",[55,56,57],"mo",{},"=",[59,60,61,97],"mfrac",{},[48,62,63,67,70,74,83,87,94],{},[51,64,66],{"mathvariant":65},"normal","Cov",[55,68,69],{},"⁡",[55,71,73],{"stretchy":72},"false","(",[75,76,77,80],"msub",{},[51,78,79],{},"R",[51,81,82],{},"i",[55,84,86],{"separator":85},"true",",",[75,88,89,91],{},[51,90,79],{},[51,92,93],{},"m",[55,95,96],{"stretchy":72},")",[48,98,99,102,104,106,112],{},[51,100,101],{"mathvariant":65},"Var",[55,103,69],{},[55,105,73],{"stretchy":72},[75,107,108,110],{},[51,109,79],{},[51,111,93],{},[55,113,96],{"stretchy":72},[115,116,118],"annotation",{"encoding":117},"application\u002Fx-tex","\\beta = \\frac{\\operatorname{Cov}(R_i, R_m)}{\\operatorname{Var}(R_m)}",[27,120,123,150],{"className":121,"ariaHidden":85},[122],"katex-html",[27,124,127,132,138,143,147],{"className":125},[126],"base",[27,128],{"className":129,"style":131},[130],"strut","height:0.8889em;vertical-align:-0.1944em;",[27,133,53],{"className":134,"style":137},[135,136],"mord","mathnormal","margin-right:0.0528em;",[27,139],{"className":140,"style":142},[141],"mspace","margin-right:0.2778em;",[27,144,57],{"className":145},[146],"mrel",[27,148],{"className":149,"style":142},[141],[27,151,153,157],{"className":152},[126],[27,154],{"className":155,"style":156},[130],"height:2.363em;vertical-align:-0.936em;",[27,158,160,165,394],{"className":159},[135],[27,161],{"className":162},[163,164],"mopen","nulldelimiter",[27,166,168],{"className":167},[59],[27,169,173,385],{"className":170},[171,172],"vlist-t","vlist-t2",[27,174,177,382],{"className":175},[176],"vlist-r",[27,178,182,260,271],{"className":179,"style":181},[180],"vlist","height:1.427em;",[27,183,185,190],{"style":184},"top:-2.314em;",[27,186],{"className":187,"style":189},[188],"pstrut","height:3em;",[27,191,193,201,204,256],{"className":192},[135],[27,194,197],{"className":195},[196],"mop",[27,198,101],{"className":199},[135,200],"mathrm",[27,202,73],{"className":203},[163],[27,205,207,211],{"className":206},[135],[27,208,79],{"className":209,"style":210},[135,136],"margin-right:0.0077em;",[27,212,215],{"className":213},[214],"msupsub",[27,216,218,247],{"className":217},[171,172],[27,219,221,242],{"className":220},[176],[27,222,225],{"className":223,"style":224},[180],"height:0.1514em;",[27,226,228,232],{"style":227},"top:-2.55em;margin-left:-0.0077em;margin-right:0.05em;",[27,229],{"className":230,"style":231},[188],"height:2.7em;",[27,233,239],{"className":234},[235,236,237,238],"sizing","reset-size6","size3","mtight",[27,240,93],{"className":241},[135,136,238],[27,243,246],{"className":244},[245],"vlist-s","​",[27,248,250],{"className":249},[176],[27,251,254],{"className":252,"style":253},[180],"height:0.15em;",[27,255],{},[27,257,96],{"className":258},[259],"mclose",[27,261,263,266],{"style":262},"top:-3.23em;",[27,264],{"className":265,"style":189},[188],[27,267],{"className":268,"style":270},[269],"frac-line","border-bottom-width:0.04em;",[27,272,274,277],{"style":273},"top:-3.677em;",[27,275],{"className":276,"style":189},[188],[27,278,280,287,290,331,335,339,379],{"className":279},[135],[27,281,283],{"className":282},[196],[27,284,66],{"className":285,"style":286},[135,200],"margin-right:0.0139em;",[27,288,73],{"className":289},[163],[27,291,293,296],{"className":292},[135],[27,294,79],{"className":295,"style":210},[135,136],[27,297,299],{"className":298},[214],[27,300,302,323],{"className":301},[171,172],[27,303,305,320],{"className":304},[176],[27,306,309],{"className":307,"style":308},[180],"height:0.3117em;",[27,310,311,314],{"style":227},[27,312],{"className":313,"style":231},[188],[27,315,317],{"className":316},[235,236,237,238],[27,318,82],{"className":319},[135,136,238],[27,321,246],{"className":322},[245],[27,324,326],{"className":325},[176],[27,327,329],{"className":328,"style":253},[180],[27,330],{},[27,332,86],{"className":333},[334],"mpunct",[27,336],{"className":337,"style":338},[141],"margin-right:0.1667em;",[27,340,342,345],{"className":341},[135],[27,343,79],{"className":344,"style":210},[135,136],[27,346,348],{"className":347},[214],[27,349,351,371],{"className":350},[171,172],[27,352,354,368],{"className":353},[176],[27,355,357],{"className":356,"style":224},[180],[27,358,359,362],{"style":227},[27,360],{"className":361,"style":231},[188],[27,363,365],{"className":364},[235,236,237,238],[27,366,93],{"className":367},[135,136,238],[27,369,246],{"className":370},[245],[27,372,374],{"className":373},[176],[27,375,377],{"className":376,"style":253},[180],[27,378],{},[27,380,96],{"className":381},[259],[27,383,246],{"className":384},[245],[27,386,388],{"className":387},[176],[27,389,392],{"className":390,"style":391},[180],"height:0.936em;",[27,393],{},[27,395],{"className":396},[259,164],[16,398,399,400,471,472,542],{},"Here, ",[27,401,403,421],{"className":402},[34],[27,404,406],{"className":405},[38],[40,407,408],{"xmlns":42},[45,409,410,418],{},[48,411,412],{},[75,413,414,416],{},[51,415,79],{},[51,417,82],{},[115,419,420],{"encoding":117},"R_i",[27,422,424],{"className":423,"ariaHidden":85},[122],[27,425,427,431],{"className":426},[126],[27,428],{"className":429,"style":430},[130],"height:0.8333em;vertical-align:-0.15em;",[27,432,434,437],{"className":433},[135],[27,435,79],{"className":436,"style":210},[135,136],[27,438,440],{"className":439},[214],[27,441,443,463],{"className":442},[171,172],[27,444,446,460],{"className":445},[176],[27,447,449],{"className":448,"style":308},[180],[27,450,451,454],{"style":227},[27,452],{"className":453,"style":231},[188],[27,455,457],{"className":456},[235,236,237,238],[27,458,82],{"className":459},[135,136,238],[27,461,246],{"className":462},[245],[27,464,466],{"className":465},[176],[27,467,469],{"className":468,"style":253},[180],[27,470],{}," is the stock's return and ",[27,473,475,493],{"className":474},[34],[27,476,478],{"className":477},[38],[40,479,480],{"xmlns":42},[45,481,482,490],{},[48,483,484],{},[75,485,486,488],{},[51,487,79],{},[51,489,93],{},[115,491,492],{"encoding":117},"R_m",[27,494,496],{"className":495,"ariaHidden":85},[122],[27,497,499,502],{"className":498},[126],[27,500],{"className":501,"style":430},[130],[27,503,505,508],{"className":504},[135],[27,506,79],{"className":507,"style":210},[135,136],[27,509,511],{"className":510},[214],[27,512,514,534],{"className":513},[171,172],[27,515,517,531],{"className":516},[176],[27,518,520],{"className":519,"style":224},[180],[27,521,522,525],{"style":227},[27,523],{"className":524,"style":231},[188],[27,526,528],{"className":527},[235,236,237,238],[27,529,93],{"className":530},[135,136,238],[27,532,246],{"className":533},[245],[27,535,537],{"className":536},[176],[27,538,540],{"className":539,"style":253},[180],[27,541],{}," is the market's return.",[11,544,546],{"id":545},"example","Example",[16,548,549],{},"A stock with a beta of 1.5 has tended to rise about 15% when the market rose 10%, and fall about 15% when the market fell 10%.",{"title":551,"searchDepth":552,"depth":552,"links":553},"",2,[554,555,556],{"id":13,"depth":552,"text":14},{"id":24,"depth":552,"text":25},{"id":545,"depth":552,"text":546},"investing","A measure of how much a stock moves relative to the overall market.","md",[561],{"q":562,"a":563},"Can beta be negative?","Yes. A negative beta means the asset has tended to move opposite to the market, as some gold or hedging assets do at times.",{},true,"\u002Fterms\u002Fbeta",[568,569],"volatility","diversification",{"title":6,"description":558},"terms\u002Fbeta",[573,574,575],"Beta compares a stock's price swings with the market's.","A beta above 1 signals more volatility than the market.","Beta ignores company-specific risk.","Mb078eJfc2Y67ZhsJCEe05TE9hcScF2_lgUKTk2oxUw",[578,582],{"title":579,"description":580,"path":581},"Diversification","Spreading money across many investments to reduce the impact of any one loss.","\u002Fterms\u002Fdiversification",{"title":583,"description":584,"path":585},"Volatility","How widely an asset's price swings over time.","\u002Fterms\u002Fvolatility",1793226379132]