What is stock beta value?
Definition: Beta is a numeric value that measures the fluctuations of a stock to changes in the overall stock market. Description: Beta measures the responsiveness of a stock’s price to changes in the overall stock market.
What is a good beta value for a stock?
Key Takeaways. Beta is a concept that measures the expected move in a stock relative to movements in the overall market. A beta greater than 1.0 suggests that the stock is more volatile than the broader market, and a beta less than 1.0 indicates a stock with lower volatility.
What does a beta of 1.5 mean?
A beta of 1.5 means that a stock’s excess return is expected to move 1.5 times the market excess returns. E.g., if market excess return is 10%, then we expect, on average, the stock return to be 15%.
Is a stock beta of 1.3 good?
If a stock has a beta above 1, it’s more volatile than the overall market. For example, if an asset has a beta of 1.3, it’s theoretically 30% more volatile than the market. Stocks generally have a positive beta since they are correlated to the market.
What does a stock beta of 0.5 mean?
For example, a beta of 0.5 implies that a stock’s movements will theoretically be about 50% of the index’s movements. A stock with a beta of more than one is more volatile than the overall index. For example, a beta of 2.0 implies that the stock will move twice as much as the market.
Is High beta good or bad?
Stocks with a value greater than 1 are more volatile than the market (meaning they will generally go up more than the market goes up, and go down more than the market goes down). Stocks with a beta of less than 1 have a smoother ride as their moves are more muted than the market’s.
Is beta less than 1 GOOD?
A beta of 1 indicates that the security’s price tends to move with the market. A beta greater than 1 indicates that the security’s price tends to be more volatile than the market. A beta of less than 1 means it tends to be less volatile than the market.
What is the lowest beta stock?
Low Beta Dividend Stocks with High Yields
- Phillips 66 Partners LP (NYSE:PSXP) Dividend Yield as of January 26: 8.18% …
- Lumen Technologies, Inc. (NYSE:LUMN) …
- Broadmark Realty Capital Inc. (NYSE:BRMK) …
- DallasNews Corporation (NASDAQ:DALN) Dividend Yield as of January 26: 9.24% …
- Chimera Investment Corporation (NYSE:CIM)
What does a stock beta of 0 mean?
A zero-beta portfolio is a portfolio constructed to have zero systematic risk, or in other words, a beta of zero. A zero-beta portfolio would have the same expected return as the risk-free rate.
What is considered high beta?
A high-beta stock, quite simply, is a stock that has been much more volatile than the index it’s being measured against. 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.
Can beta of a stock be negative?
Yes, beta can be negative. To see how and why, consider what beta measures: the risk added by an investment to a well diversified portfolio. By that definition, any investment that when added to a portfolio, makes the overall risk of the portfolio go down, has a negative beta.
What does a beta of 10 mean in stocks?
That is, a 10% up or down move in the stock market index should theoretically result in a 10% up or down move in the stock. A beta of 2.0 implies the stock will tend to move twice as much as the market. That is, if the market moves up 10%, the stock should move up 20%.
What does a beta of 0.6 mean?
Teva Pharmaceutical Industry’s 2.49 beta, for example, indicates that the stock is expected to be more than twice as volatile than the market, while Intel’s beta of 0.6 means the stock will typically move at a rate that’s only about half that the broader market (data from Yahoo Finance, June 13, 2019).
What is a good dividend yield?
What is a good dividend yield? In general, dividend yields of 2% to 4% are considered strong, and anything above 4% can be a great buy—but also a risky one. When comparing stocks, it’s important to look at more than just the dividend yield.
Can you live off dividends?
Over time, the cash flow generated by those dividend payments can supplement your Social Security and pension income. Perhaps, it can even provide all the money you need to maintain your preretirement lifestyle. It is possible to live off dividends if you do a little planning.
What is the cheapest stock that pays the highest dividend?
10 Cheap Dividend Stocks with High Yields
- The Williams Companies, Inc. (NYSE:WMB) …
- Enterprise Products Partners L.P. (NYSE:EPD) Number of Hedge Fund Holders: 21. …
- Global Partners LP (NYSE:GLP) Number of Hedge Fund Holders: 2. …
- Ellington Financial Inc. (NYSE:EFC) …
- Ready Capital Corporation (NYSE:RC)