Low Beta Stocks

Beta is the a calculation that measures the relative volatility of a stock in correlation to a particular standard. For U.S. stocks that standard is usually, but not always, the S&P 500. Beta is a form of regression analysis and it can be useful for investors regardless of their risk tolerance. Beta is considered one of the few data points that can be beneficial for practitioners of both fundamental analysis and technical analysis. This page lists stocks that have unusually low beta calculations, meaning there is little correlation between the price moves of these stocks and the S&P 500.

Symbol Name Price Beta Volume Market Cap Last Annual Dividend
MSFT Microsoft Corporation $415.5 0.899 17.6M 3.09T 3
VOO Vanguard 500 Index Fund $471.43 1 4.83M 1.01T 6.3572
VFIAX Vanguard 500 Index Fd Admiral Shs $475.03 1 - 1.01T 4.8733
BRK-B Berkshire Hathaway Inc. $407.11 0.883 3.28M 881.53B 0
BRK-A Berkshire Hathaway Inc. $613965 0.883 14540 880.55B 0
LLY Eli Lilly and Company $782.12 0.316 3.79M 743.14B 5.2
V Visa Inc. $283.16 0.974 3.96M 581.63B 2.08
NVO Novo Nordisk A/S $124.23 0.176 5.43M 552.45B 1.37
FXAIX Fidelity 500 Index Fund $178.68 1 - 484.42B 2.401
SPY SPDR S&P 500 ETF Trust $512.85 1 76.61M 483.7B 6.6338099999999995
WMT Walmart Inc. $58.76 0.49 16.38M 473.18B 0.83
UNH UnitedHealth Group Incorporated $489.53 0.549 7.12M 451.31B 7.52
XOM Exxon Mobil Corporation $105.84 0.96 16.49M 419.96B 3.8
JNJ Johnson & Johnson $162.12 0.535 4.57M 390.51B 4.76
HD The Home Depot, Inc. $384.45 0.981 2.75M 382.63B 9
PG The Procter & Gamble Company $158.85 0.435 4.82M 373.78B 3.76
COST Costco Wholesale Corporation $749.44 0.759 1.67M 332.55B 4.08
TM Toyota Motor Corporation $246.04 0.483 337.3K 331.81B 4.01
MRK Merck & Co., Inc. $126.96 0.386 4.21M 321.54B 3.08
IVV iShares Core S&P 500 ETF $515.39 1 4.28M 320.34B 6.89877
BND Vanguard Total Bond Market Index Fund $72.32 1 6.33M 316.59B 2.34329
VBTLX Vanguard Total Bond Market Index Fund Admiral Shares $9.53 1 - 316.33B 0.13082100000000002
VBMPX Vanguard Total Bond Market Idx InstlPls $9.53 1 - 316.33B 0.10700000000000001
VBMFX Vanguard Total Bond Market Index Fund Investor Shares $9.53 1 - 316.33B 0.10300000000000001
ABBV AbbVie Inc. $178.91 0.542 4.03M 316.04B 6.2
VTBNX Vanguard Total Bond Market II Idx I $9.42 0.99 - 274.71B 0.10600000000000001
VINIX Vanguard Institutional Index Fund Institutional Shares $424.83 1 - 269.62B 3.009
VIIIX Vanguard Institutional Index Fund $424.83 1 - 269.62B 3.0359999999999996
KO The Coca-Cola Company $59.53 0.588 10.9M 256.72B 1.94
RMS.PA Hermès International Société en commandite par actions $2308 0.731 32092 241.28B 13
OR.PA L'Oréal S.A. $441.95 0.714 228.32K 236.32B 6.6
PEP PepsiCo, Inc. $164.59 0.546 6.11M 226.22B 5.06
TMO Thermo Fisher Scientific Inc. $576.33 0.813 1.44M 222.68B 1.4
SAP SAP SE $188.53 0.967 641.31K 220.06B 2.23
LIN Linde plc $449.21 0.93 1.64M 216.33B 5.56
ABALX American Funds American Balanced Fund Class A $33.38 0.95 - 212.16B 0.755
BALFX American Funds American Balanced Fund, Class F-1 Shs $33.35 0.95 - 212.16B 0.739
RLBGX American Funds American Balanced Fund Class R-6 $33.41 0.95 - 212.16B 0.851
AMBFX American Balanced Fund Class F-2 Shs $33.37 0.95 - 212.16B 0.82
AFMBX American Funds American Balanced Fund $33.38 0.95 - 211.34B 0.851
MCD McDonald's Corporation $290.73 0.728 3.01M 209.92B 6.68
NVS Novartis AG $102.06 0.467 1.6M 208.61B 3.78
ABT Abbott Laboratories $118.62 0.745 3.2M 205.83B 2.2
SHEL Shell plc $63.56 0.561 4.78M 204.45B 2.75
AZN AstraZeneca PLC $64.6 0.185 3.97M 200.25B 1.45
CSCO Cisco Systems, Inc. $48.4 0.88 17.01M 195.98B 1.6
TMUS T-Mobile US, Inc. $163.37 0.494 3.3M 193.9B 1.3
BABA Alibaba Group Holding Limited $74.62 0.47 11.63M 189.8B 1
SHELL.AS Shell plc $29.445 0.561 8.27M 189.43B 1.28
DHR Danaher Corporation $255.87 0.871 1.91M 189.27B 1.08
VEMRX Vanguard Emerging Mkts Stock Idx InsPlus $87.56 0.87 - 186.74B 3.044
RY.TO Royal Bank of Canada $131.94 0.837 1.86M 185.03B 5.52
IBM International Business Machines Corporation $188.2 0.716 4.02M 172.53B 6.64
VZ Verizon Communications Inc. $40.2 0.403 9.86M 169.01B 2.66
PDD PDD Holdings Inc. $126.85 0.68 4.48M 168.53B 0
NOW ServiceNow, Inc. $773.63 0.991 756.95K 158.59B 0
AMGN Amgen Inc. $280.33 0.617 3.77M 150.23B 9
PFE Pfizer Inc. $26.59 0.568 39.2M 150.15B 1.68
TTE TotalEnergies SE $64.5 0.787 889.86K 150.05B 3.2
HSBC HSBC Holdings plc $38.98 0.588 2.21M 148.59B 3.05
BHP BHP Group Limited $58.34 0.865 2.71M 147.81B 3.04
TD.TO The Toronto-Dominion Bank $81.31 0.842 3.5M 145.66B 4.08
PONPX PIMCO Income Fund $10.55 0.77 - 140.94B 0.216
PIMIX PIMCO Income Fund Institutional Class $10.55 0.77 - 140.94B 0.22
PM Philip Morris International Inc. $89.83 0.654 4.2M 139.46B 5.2
TTE.PA TotalEnergies SE $59.8 0.787 3.01M 139.11B 3.16
AWSHX American Funds Washington Mutual Investors Fund Class A $61 0.82 - 137B 0.958
RWMFX American Funds Washington Mutual Investors Fund Class R-5 $60.98 0.82 - 136.96B 1.096
CWMAX American Funds Washington Mutual Investors Fund Class 529-A $60.8 0.82 - 136.55B 0.937
WSHFX Washington Mutual Invs Fund Cl F-1 Shs $60.68 0.82 - 136.28B 0.9279999999999999
WSHCX American Funds Washington Mutual Investors Fund Class C $59.86 0.82 - 134.44B 0.5559999999999999
SYK Stryker Corporation $353.22 0.905 1.32M 134.32B 3.2
RWMBX American Funds Washington Mutual Investors Fund $59.71 0.82 - 134.11B 0.5469999999999999
HDB HDFC Bank Limited $55.01 0.79 2.78M 131.09B 0.7
AICCX American Funds Investment Co of America C $53.52 0.91 - 127.09B 0.377
RICBX American Funds Invmt Co of Amer R2 $53.77 0.91 - 127.09B 0.37100000000000005
RICAX American Funds Investment Company of America Class R-1 $53.69 0.91 - 127.09B 0.37700000000000006
AICFX American Funds Investment Co of America Cl F-1 Shs $54.16 0.91 - 127.09B 0.6950000000000001
AIVSX American Funds Invmt Co of Amer A $54.35 0.91 - 127.09B 0.7250000000000001
ANCFX American Funds Fundamental Investors $77.56 0.96 - 125.23B 0.8380000000000001
AFIFX Fundamental Investors, Class F01 Shares $77.51 0.96 - 125.23B 0.804
CFNAX American Funds Fundamental Investors Class 529-A $77.39 0.96 - 125.23B 0.811
MUFG Mitsubishi UFJ Financial Group, Inc. $10.43 0.627 2.12M 123.91B 0.25
UL Unilever PLC $49.15 0.171 2.23M 122.83B 1.86
FCNTX Fidelity Contrafund Fund $18.66 1 - 121.94B 0.081
T AT&T Inc. $16.98 0.713 23.8M 121.45B 1.11
BUD Anheuser-Busch InBev SA/NV $60.17 0.992 1.58M 119.39B 0.82
RIDGX American Funds The Income Fund of America $23.76 0.89 - 119.2B 0.9279999999999999
IFAFX The Income Fund of America, Class F-1 Shares $23.66 0.89 - 119.2B 0.8420000000000001
AMECX American Funds The Income Fund of America Class A $23.74 0.89 - 119.2B 0.8570000000000001
RTX Raytheon Technologies Corporation $89.8 0.627 6.1M 119.15B 2.36
SCHW The Charles Schwab Corporation $66.47 0.989 7.87M 117.88B 1
CWGFX American Funds Capital World Growth & Income Fund Class F-1 Shs $63.39 0.99 - 117.34B 1.0779999999999998
RWICX American Funds Capital World Growth and Income Fund Class R-3 $63.02 0.98 - 117.34B 0.9420000000000001
CWIAX American Funds Capital World Growth and Income Fund Class 529-A $63.29 0.98 - 117.34B 1.091
CWGIX American Funds Capital World Growth and Income Fund Class A $63.57 0.99 - 117.34B 1.11
ELV Elevance Health Inc. $499.11 0.785 1.4M 116.13B 6.52
NEE NextEra Energy, Inc. $55.21 0.521 15.4M 113.31B 2.06
CNR.TO Canadian National Railway Company $176.69 0.656 994.16K 113.21B 3.38
UNA.AS Unilever PLC $45.17 0.171 950.1K 112.88B 1.71

What Are Low Beta Stocks

Many retail investors assume that you can’t predict the stock market. And since you can’t predict it, they assume that investing in stocks carries a certain amount of risk. Well, as it turns out, there is a way to assess the risk of a particular security: it’s called beta. Low beta stocks are those securities that carry the lowest amount of risk.

In the context of investing, understanding beta also serves a predictive function. Specifically, knowing a stock’s beta can help investors understand why a company may be performing or underperforming. In this way, beta can help investors predict how a stock is likely to perform before they buy the stock.

This article will define beta and key terms to help investors understand beta. We’ll also review the difference between provided beta and personally calculated beta, what beta indicates, and how to use beta to diversify a portfolio. And finally, we’ll look at a couple of limitations to beta.

Beta is a Measurement of Volatility That Supports Fundamental and Technical Indicators

Beta measures the relative volatility of a stock in correlation to a particular standard. For U.S. stocks that standard is usually, but not always, the S&P 500. Beta can also be used by investors to evaluate a particular stock’s expected rate of return, particularly when using the Capital Asset Pricing Model (CAMP).

Beta is a form of regression analysis and it can be useful for investors regardless of their risk tolerance. Beta is considered one of the few data points that can be beneficial for practitioners of fundamental analysis and technical analysis. Investors who tend to analyze stocks using fundamental analysis will use beta along with price-to-earnings ratio, shareholders equity, debt-to-equity ratio and other factors. Technical analysts will use beta as an indicator of stocks that offer the price movement they are seeking. They will use beta along with other indicators such as average daily trading volume (ADTV) and a stock’s moving average.

What is the Formula for Calculating Beta?

Investing websites like MarketBeat give investors access to many company’s financial metrics. This means that investors do not typically need to calculate beta for themselves. But it’s still helpful to understand the meaning of two variables that are used in the formula for beta. These variables are covariance and variance.

  • Covariance is a measurement of how two stocks move together. If the number is positive it means the price movement is generally correlated (i.e. when one stock goes up, so does the other and vice versa). If the number is negative, it means the price movement is generally not correlated (i.e. when one stock goes up, the other goes down and vice versa).
  • Variance is a measurement of how far a stock moves in relation to its mean. In the case of beta, the mean is whatever benchmark is being used.

What Are the Variables in “Provided Beta” Calculations?

In many cases, a financial website will give what’s known as the “provided beta” for a particular stock. For active traders, financial software programs will also provide the beta value. When using a provided beta, investors should pay attention to two variables.

First, it’s important to understand what benchmark is being used to determine beta. Since the beta shows a correlation between a particular security and something, an investor needs to know what that something is. As pointed out above, for U.S. stocks it is common for beta to be expressed as a correlation to a stock index, usually the S&P 500, but not always. In some cases, the Dow Jones Industrial Average (DJIA) may be used, or even the NASDAQ.

The second thing an investor will need to know about a stock’s beta is the time frame that is being measured. If you’re a long-term investor, you may want to know the beta over several years. If you’re an active trader, you’ll probably be more interested in the beta over a much more recent timeframe.

A personally calculated beta, on the other hand, is one that investors will calculate for themselves. To calculate beta, investors will have to know the covariance between the return of the stock being analyzed and the return of the benchmark for that stock as well as the variance of the market returns.

As we mentioned above, many financial software programs will do the calculation for you. It is also possible to use an Excel spreadsheet to calculate beta. For many investors, particularly those who are engaging in day trading, a personally calculated beta may be more accurate for their needs.