Investors understand intuitively that some stocks are riskier than others. The capital asset pricing model attempts to quantify the common perception of risk using a term called beta. By understanding ...

Last week, we received some excellent feedback in response to Monday’s article on calculating a stock’s beta. So today, I’m going to take this little-known metric one step further by showing you how ...

When it comes to picking stocks, everyone knows about alpha. Whether you were aware of it or not, we’re all looking for alpha, or outperformance, when trading or investing in stocks. Alpha is the ...

Every investor strives to balance two conflicting goals: Maximizing their investment returns and minimizing their risk. Beta offers a way to measure the amount of risk you’re taking on for a given ...

Beta is a measurement of an asset’s risk compared to a benchmark, like the stock market. The market or benchmark used to calculate an asset’s beta always has a beta of 1. Stocks that have a return ...

We often hear the word beta in the context of “beta test”. It’s a way of testing something (e.g. a software program) in a real-world situation to iron out any glitches before rolling it out to the ...