Investing word of the day: Beta

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source: http://tiie.com

I always see this word in the analysis of finance websites like Reuters.com and Bloomberg.com but when I searched what is it and what use is it for me Investopedia's video has answered all my questions. So see the video below and learn how you can use Beta in your stock trades.

Oops I know you didn't quite get it so let me explain.

Beta coefficient or simply Beta is a measure of volatility or risk as compared to the market as a whole. Philippine listed stocks are compared to the PSEi to compute their Beta.

In a way it is a multiplier which uses the PSEi as the base comparison.  As the video said it is a way of knowing the movement of the stock as compared to the base it is compared to. Below is the generalized assumption as quoted from Investopedia.com

A beta of 1 indicates that the security's price will move with the market. A beta of less than 1 means that the security will be less volatile than the market. A beta of greater than 1 indicates that the security's price will be more volatile than the market. For example, if a stock's beta is 1.2, it's theoretically 20% more volatile than the market. 

To sum it up:


If Beta is = 1 stock follows the trend of the PSEi
If Beta is > 1 stock is more volatile than the market thus  
                   unpredictable
If Beta is < 1 stock is less volatile than the market thereby slow 
                   moving than the market but stable

Christmas season

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 source: http://siebel-essentials.blogspot.com/

We celebrated Christmas yesterday and the PSE has been closed since Dec 24 till Dec 28 in observance of the holidays.

So what have you thought during these days? Most people spend Christmas with parties and buying here and there. There is nothing wrong with enjoying the holidays, the thing is even though it is a once in a year celebration one should always keep in mind one's goals. It is okay to buy gifts as long as it is the thought that counts rather than the monetary value. 

Give gifts of value. 

 source: http://affordableutahweddings.com

Something that the person you gave will cherish for a long time and from time to time will look back and remember  and smile.

sources:www.pravsworld.com & http://www.ayesha.thalassemia.com.

Most little ones at this time might receive money from their lolo, lola, auntie and uncle. Why not teach them to save up those small monetary gifts from  lolo and tell them that if such is accumulated to at least Php 5,000.00 they can open an online brokerage account at Metrobank and start buying stock with intrinsic value while their young, remember TEL years back was only at 250 per share but now its already at 2400.

But above all remember the reason why we celebrate this event. God loves us that much that He gave His own Son for us. How about you what can you share this Christmas?

We thank you for helping us give some to our poor kababayan in Isabela as well as for the CCVF project. We hope to actively give what ever we can to the least of our brethren if we have some extra. No matter how small it is when we put it together it becomes a bigger chunk.

Give not because you want something in return, give because you want to give. Give without expecting any in return.

source: http://www.abchomepreschool.com/PreschoolEducationBlog/