The Beta for a portfolio is the weighted sum of the individual asset Betas. Hence, you will have to see how much exposure each individual stock will have to the market and what the correlation of the stock movement with the S&P 500 Trust ETF, or SPY.

Look at the individual positions that you have in your portfolio. Compare it to SPY ETF in terms of what kind of returns you will have or what kind of movements you will have, and find the correlation between your stock, its position and the market.

A Beta of 1.05- relative to the S&P 500- implies that if the S&P’s excess return increases by 10% the portfolio is expected to increase by 10.5%. This means that you have stocks that are more volatile than the market. The higher the Beta, the higher your exposure to the market and the higher are the chances of the individual stocks being sold off at a higher rate than that of the market itself.


I. Tradespoon 101

II. Advanced Options Strategies

The Greeks

III. Technical Analysis

Introduction to Technical Analysis


Chart Patterns

Reading Predictions

IV. Developing a Trading Plan

Portfolio Management


Tradespoon e-Book Home