beta

Definition

A quantitative measure of the volatility of a given stock, mutual fund, or portfolio, relative to the overall market, usually the S&P 500. Specifically, the performance the stock, fund or portfolio has experienced in the last 5 years as the S&P moved 1% up or down. A beta above 1 is more volatile than the overall market, while a beta below 1 is less volatile.

Use beta in a sentence

The beta was pleasing to us as we were interested in many different metrics and ratios to best understand the security.

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The software company's engineers continued their work on the complex and difficult finance software, which entered live beta testing yesterday.

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Before the company can release the software, there is a testing phase called the Beta testing phase in which qualified testers will determine if the software is stable or not.

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high beta index expected return-beta relationship