Beta (β)

Beta is the regression slope of a stock's returns against a market index, typically the S&P 500 or the Tadawul All Share. β = 1.0 means the stock moves in lockstep with the market; β > 1 amplifies market moves and β < 1 dampens them.

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

Beta is backward-looking and regime-dependent. A defensive stock in a recession may behave like a cyclical one in an expansion. Use rolling betas for a more current picture, and never quote beta without its time window.