It turns out you can – at least theoretically – thanks to a statistical measurement known as beta. Profit and prosper with the best of expert advice on investing, taxes, retirement ...
When you hear "beta" in reference to investing, think "broad" or "benchmark." Beta is a measure of how volatile an investment's price is relative to the broader market or a benchmark such as the S ...
Investors who are willing to take on more risk may prefer to invest in stocks with higher betas, promising outsized returns at the risk of outsized losses. Where to Find the Beta Number Many ...
Smart beta is a way of investing that combines the benefits of passive investing and the advantages of active investing strategies. It derives from the capital asset pricing model (CAPM ...
Before getting into the formulas, consider the following scenario: You invest in a fund manager who tends to buy many stocks that can be volatile against the market (so-called high-beta stocks).
Recognizing these challenges, several investment managers have introduced a middle ground: so-called "smart beta" exchange-traded funds, or ETFs. The name itself offers insight into its philosophy.
Beta measures the risk or volatility of a company’s share price in comparison to the market as a whole. For example, a company with a beta of 1.1 will theoretically see its stock price increase ...
This process mirrors the concept of factor investing: using specific criteria, or factors, to filter and select investments. Factor-based index funds, also known as smart beta or strategic index ...