What the good range of beta in stocks?
4/10/2024 03:56pm
The good range of beta in stocks can vary depending on an investor's risk tolerance and investment objectives. However, a generally accepted range for beta in stocks is between 0 and 1. A beta of 0 indicates that the stock is not at all reactive to market movements, while a beta of 1 indicates that the stock moves exactly with the market. Beta values above 1 indicate that the stock is more volatile than the market, while values below 1 indicate that the stock is less volatile than the market. It's important to note that high beta stocks can offer higher potential returns but also come with higher risk, while low beta stocks are generally less volatile and may be more suitable for conservative investors. Ultimately, the appropriate range of beta for an individual stock will depend on a variety of factors, including the company's industry, growth potential, and overall market conditions.