Portfolio Metrics

Beta

Definition

What is Beta?

A measure of how strongly an investment's returns tend to move relative to a market benchmark.

Example in practice

A beta of 1.2 suggests the fund historically moved about 20% more than the benchmark, in either direction.

Keep learning

The percentage of a portfolio invested across asset classes such as cash, bonds, shares, and property.

Spreading investments across assets, issuers, sectors, or markets to reduce dependence on one exposure.

The degree to which a portfolio depends on a small number of holdings, sectors, or issuers.

The identity and due-diligence checks a financial institution performs before serving an investor.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.