Content Management & Research Librarian; Economics & Finance Liaison
What is Beta?
Beta (β) is a measure of volatility, or systematic risk, of a security or portfolio in comparison to the market as a whole. (Most people use the S&P 500 Index to represent the market.)
Beta is also a measure of the covariance of a stock with the market. It is calculated using regression analysis.
- A beta of 1 indicates that the security's price is expected to move with the market.
- A beta greater than 1 indicates that the security's price is expected to be more volatile than the market.
- A beta of less than 1 indicates that the security's price is expected to be less volatile than the market.
You can think of beta as the tendency of a security's returns to respond to swings in the market. For example, if a stock's beta is 1.2, then it is theoretically 20% more volatile than the market.
Use Library & Cutler Center Resources to Research Beta
Each resource will provide you with varying results for the beta of a security due to differences in the calculations used in each program. These issues are addressed in this guide.
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BloombergFind company financials, news, analytics, multimedia reports, e-mail and trading capabilities, available in the Cutler Center.
Pull the time series data from WRDS to calculate Beta yourself. See Calculating Beta tab for instructions.
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WRDS (Faculty and Graduate Student Login) This link opens in a new windowGraduate Students will now receive an individual WRDS account
WRDS (Wharton Research Data Services) is a gateway to financial, accounting, banking, economics, management, and marketing data accessible through a single web-based interface provided by the Wharton School of the University of Pennsylvania. -
WRDS (Undergraduate Student and Staff-Day Pass) This link opens in a new windowStudents and Staff now use a Day Pass for access. See Instruction guide for more information
WRDS (Wharton Research Data Services) is a gateway to financial, accounting, banking, economics, management, and marketing data accessible through a single web-based interface provided by the Wharton School of the University of Pennsylvania.
