Beta (β)

Beta is the regression slope of a stock's returns against an index's returns (typically the S&P 500). β = 1.0 means the stock moves in lockstep with the market. β > 1 amplifies market moves; β < 1 dampens them.

A negative beta is rare and indicates inverse correlation — gold stocks and short-term Treasuries can show negative betas during equity sell-offs.

Beta is backward-looking. It can shift across regimes (a defensive stock during a recession may behave like a cyclical one during an expansion). Use rolling betas for a more current picture.