Calculation of beta of a stock
Value Around -1. The -1 beta means that a stock is inversely correlated to the benchmark index. Don’t expect the stock chart to be a mirror image of the index, of course. But when the price of the index increases, you might notice that the stock price drops as well. Steps to Calculate Beta for a Stock Portfolio The beta for individual stocks is readily available on the websites of most online discount brokerages or reliable publishers of investment research. To determine the beta of an entire portfolio of stocks, you can follow these four steps: Beta values range from 0 to 1, with a value of 1 indicating the highest degree of correlation between the stock and the benchmark. R-Squared is measure that reflects the reliability of a given Beta figure, and should be included in every calculation of a stock's Beta.