So – What is Financial BETA, Granularity?

MUCH MORE COMPLICATED THAN MOST [PHYSICIAN] INVESTORS THINK!

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By Dr. David Edward Marcinko MBA CMP®

CMP logo

SPONSORED: http://www.CertifiedMedicalPlanner.org

May 11, 2021

Dow34,269.16-473.66-1.36%
S&P 5004,152.10-36.33-0.87%
Nasdaq13,389.43-12.43-0.09%
GlobalDow4,011.09-61.07-1.50%

Most all investors and physician executives are aware of the concept of financial beta.

BETA: A Systemic risk measurement benchmark correlating with a change in a specific index.

EXAMPLE: The measure of a stock’s volatility relative to the market, where a beta lower than 1 means the stock is less sensitive than the market as a whole; higher than 1 indicates the stock is more volatile than the market. The healthcare industry is considered to be increasingly volatile and hence possess a higher beta.

CITATION: https://www.r2library.com/Resource/Title/0826102549

See the source image

QUERY: But, what about more granular concepts like Levered Beta vs Un-levered Beta?

LINK: https://corporatefinanceinstitute.com/resources/knowledge/valuation/what-is-beta-guide/

ALPHA versus BETA Podcast: https://youtu.be/dP_23vKJ3HQ

YOUR THOUGHTS ARE APPRECIATED

Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™

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THANK YOU

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3 Responses

  1. What is Smart Beta?

    Smart beta refers to investment in portfolios, being a combination of both passive and active investing. The smart beta approach is an arguably perfect intersection between traditional value investing and the efficient market hypothesis.
    https://www.bloomberg.com/opinion/articles/2018-06-08/smart-beta-performance-isn-t-worth-the-cost
    Really?

    Jorge

    Liked by 2 people

  2. Markets:

    In a head-spinning day on Wall Street, the Nasdaq climbed out of a major hole to close almost flat on the day, but the Dow had its worst trading day since February. And Roblox surged after posting its first earnings beat as a public company Monday.

    Jeremy

    Liked by 1 person

  3. BETA?
    “The riskiness of an investment is not measured by beta (a Wall Street term encompassing volatility and often used in measuring risk) but rather by the probability of that investment causing its owner a loss of purchasing power over his contemplated holding period. Assets can fluctuate greatly in price and not be risky as long as they are reasonably certain to deliver increased purchasing power over their holding period.”
    W. Buffett
    via DEM

    Like

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