I’ve been reading about investing and keep seeing the term beta in finance, but I'm not exactly sure what it means. From what I understand, beta measures how much a stock moves compared to the overall market — like whether it’s more volatile or more stable. For example, a beta higher than 1 supposedly means the stock is more volatile than the market, and a beta lower than 1 means it’s more stable. But how is beta actually used when making investment decisions? And does a higher beta mean higher risk but potentially higher return?
What is beta in finance?
- Thread starter Sinvelen
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