The phrase
"high beta" refers to a situation where something is more sensitive to changes or fluctuations compared to others. It often suggests that an investment or stock has a higher risk and bigger potential for gains or losses, as it moves more with changes in the market.
Full definition
All five major indices closed well in the black with
higher beta stocks showing the most strength.
Those who want to add more or less short term exposure to the market can do so easily
with high beta sector ETFs.
Higher beta sectors have been in favor for much of this year, but investors should not turn their backs on dividend strategies.
Bigger cap issues showed strength
as high beta issues struggled.
High beta assets are such because of a high degree of market exposure: a large amount of correlation with the overall market and high volatility.
With respect to beta, low beta is the worst performer,
while high beta turns in the second - best performance.
Once we move into a more volatile environment, investors will rotate
from high beta into low volatility ETFs and the performance differential between equal and cap weighted ETFs will reduce.
A bear market tends to favor lower volatility stocks while a bull market
favors higher beta / growth stocks.
Their approach captures the idea that downside risk aversion makes investors view assets with
high beta during bad market conditions as particularly risky.
The other two factors are betting - against - beta (buy low beta and
avoid high beta) and quality (profitable, growing, dividend - paying).
They rank as one of the highest vegetable sources of antioxidants thanks to their
crazy high beta - carotene content.
In a flurry of
high beta brain wave activity, my mind starts making connections.
In aggregate (
i.e. high beta) this doesn't work but this example does appear to indicate something about improving returns through more capital efficient investments.
Rising rates don't give us a reliable guide to the relative performance of growth vs. value, say, or of low volatility
vs. high beta.
Explore differences between
accessing high beta stocks with either mutual funds or ETFs, as well as the best options for long - term holds and trading.
This means the fund may include companies that are highly correlated with the market (that is, stocks with
relatively high beta).
High beta stocks carry higher risks, similarly options trading is more risky than stocks trading.
A bear market tends to favor lower volatility stocks while a bull market
favors higher beta / growth stocks.
It also produces considerable sector biases relative to the market, sometimes to sectors
with higher beta.
As the name implies, the S&P 500
High Beta Index measures the performance of 100 stocks within the S&P 500 that have the highest trailing 12 - month standard deviations.
With BRIC ETFs getting all the attention in international funds for years, as investors seek the next round of emerging market economies to satiate appetite
for high Beta returns, it may be worth hitching a ride on this Frontier Market ETF.
Sabbagh next moved to the National Spherical Torus Experiment (NSTX), where he investigated ways to stabilize plasma
at high beta by controlling phenomena called resistive wall mode instabilities.
Sure, popular shorts like USTs / «long duration,» EM stocks, gold and equity «growth» factor are all squeezing higher out of the gates — but by and large, so too are popular longs like small cap equities, inflation, copper, «
high beta cyclical» equities, «value» factor and HY.
In order to achieve these type of gains, the stocks we swing trade are
typically high beta, with plenty of volatility.
Sectors with
higher betas confer greater risks, while sectors with lower betas offer greater stability during downturns.
The
very high beta exposure taken by managers and institutions lately (see Unbalanced Risk) strikes me as particularly dangerous in an environment where we continue to estimate the market's return / risk profile among the most negative 0.5 % of historical instances.
A recent post from Barron's attempts to compare the performance of PowerShares S&P 500 ® Low Volatility Portfolio (ticker SPLV) to that of PowerShares S&P 500
® High Beta Portfolio (SPHB).
This newly launched ETF will be extremely volatile for two reasons: Tech and China, each of which
carry high Beta on their own in contrast to US equities at large.
Macro factors may not completely explain the favorable impact of energy exposure on value stocks and
high beta based indices; stock selection was also important to energy sector returns.
For example, investors typically
equate higher beta or riskier «glamor stocks» with momentum.
A diversified portfolio of
high Beta equities will tend to outperform the broader market when prices are on the rise, but lag behind when the market falters.
The
Xtrackers High Beta High Yield Bond ETF tracks an index of USD - denominated high yield bonds with a high yield to worst.
HYUP provides exposure to a portion of the USD high - yield bond space that
exhibits higher beta, which may appeal to investors who want a risk - on approach.