Beta is a calculation meant to measure astock’s volatility compared with the overall market’s volatility. If you think of risk as the possibility of stock price dipping in value, beta can help you identifyrisky stocks. The overall stock market has a beta of 1, and a stocks beta coeffici...
Types of Risk Measures There are five principal risk measures, and each measure provides a unique way to assess the risk present in investments that are under consideration. The five measures include alpha, beta, R-squared, standard deviation, and the Sharpe ratio.Risk measurescan be used indivi...
The risk/reward ratio is often used as a measure when trading individual stocks. The optimal risk/reward ratio differs widely among various trading strategies. Some trial-and-error methods are usually required to determine which ratio is best for a given trading strategy, and many investors have...
To calculate beta, investors divide the covariance of an individual stock (say,Apple) with the overall market, often represented by theStandard & Poor’s 500 Index, by the variance of the market’s returns compared to its average return. Covariance is a measure of how two securities move in...
Consider diversifying your portfolio by buying the top stocks from each of the 11 sectors. Glenn FydenkevezDec. 13, 2024 Investing in Real Estate in 2025 Real estate investors can find opportunities in up and down markets, and several destinations within and outside the U.S. are solid picks...
This measure of a stock’s value tells you how much investors are willing to pay to receive $1 of the company’s current earnings. Keep in mind that the P/E ratio is derived from the potentially flawed earnings per share calculation, and analyst estimates are notoriously focused on the ...
Imagine that you were estimating the value of a country. You could measure it by the dollar value of the economy, or the size of the population, or the square acreage of the land. Measuring a company is similarly complex, but market cap is a simple and popular...
Do check the balance sheet High levels of debt represent a competing use of cash. If push comes to shove, the company is going to pay its creditors before it pays its dividends. A good rule to consider is to favor companies with a "current ratio"—a measure of the company's current ...
These so-called inverse ETFs could boost your portfolio even when the broader stock market drops. They could also leave you deep in the red. Here's a look at how inverse ETFs work, along with some popular examples: What are the risks of inverse ETFs? Inverse Cramer ETF: A case ...
We show you how to quantify resume achievements in 2025 and give examples of the types of accomplishments you can highlight with hard numbers.