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 $453.55 0.894 16.18M 3.37T 3
VOO Vanguard 500 Index Fund $514.55 1 4.72M 1.19T 6.619999999999999
VFIAX Vanguard 500 Index Fd Admiral Shs $518.27 1 - 1.18T 4.842700000000001
BRK-B Berkshire Hathaway Inc. $424.44 0.869 4.81M 916B 0
LLY Eli Lilly and Company $948.4 0.409 2.15M 901.36B 5.2
NVO Novo Nordisk A/S $142.08 0.151 2.83M 623.25B 1.37
FXAIX Fidelity 500 Index Fund $195.04 1 - 561.29B 1.814
WMT Walmart Inc. $69.24 0.501 9.31M 556.93B 0.83
V Visa Inc. $265.74 0.953 6.04M 531.66B 2.08
SPY SPDR S&P 500 ETF Trust $559.99 1 45.28M 513.95B 6.8431999999999995
XOM Exxon Mobil Corporation $113.27 0.893 11.62M 508.12B 3.8
UNH UnitedHealth Group Incorporated $511.53 0.603 3.41M 470.8B 8.4
PG The Procter & Gamble Company $166.61 0.4 3.03M 393.22B 4.03
COST Costco Wholesale Corporation $842.9 0.769 3.26M 373.69B 4.64
JNJ Johnson & Johnson $149.88 0.517 4.66M 360.71B 4.96
MC.PA LVMH Moët Hennessy - Louis Vuitton, Société Européenne $724.8 0.981 319.57K 360.67B 13
HD The Home Depot, Inc. $359.77 0.989 3.36M 356.75B 9
IVV iShares Core S&P 500 ETF $562.94 1 2.73M 349.9B 7.18873
MRK Merck & Co., Inc. $127.76 0.389 5.85M 323.59B 3.08
BND Vanguard Total Bond Market Index Fund $72.98 0.99 4.62M 321.02B 2.47915
VBTLX Vanguard Total Bond Market Index Fund Admiral Shares $9.61 0.99 - 320.72B 0.273
VBMFX Vanguard Total Bond Market Index Fund Investor Shares $9.61 0.99 - 320.72B 0.264
VBMPX Vanguard Total Bond Market Idx InstlPls $9.61 0.99 - 320.06B 0.274
ABBV AbbVie Inc. $170.28 0.623 3.86M 300.69B 6.2
VINIX Vanguard Institutional Index Fund Institutional Shares $462.17 1 - 297.44B 2.976
VIIIX Vanguard Institutional Index Fund $462.16 1 - 297.44B 3.004
VTBNX Vanguard Total Bond Market II Idx I $9.49 0.99 - 290.8B 0.27399999999999997
TM Toyota Motor Corporation $207.59 0.472 195.76K 279.6B 4.01
KO The Coca-Cola Company $63.7 0.592 8.6M 274.42B 1.94
AZN AstraZeneca PLC $79.24 0.15 3.01M 245.69B 1.45
SAP SAP SE $205.11 0.923 630.45K 239.41B 2.39
SHEL Shell plc $73.08 0.549 1.64M 234.46B 2.75
PEP PepsiCo, Inc. $166.38 0.526 6.33M 228.74B 5.42
BALFX American Funds American Balanced Fund, Class F-1 Shs $35.27 0.96 - 227.5B 0.758
ABALX American Funds American Balanced Fund Class A $35.31 0.96 - 227.5B 0.775
RMS.PA Hermès International Société en commandite par actions $2170 0.719 63463 227.26B 15
AFMBX American Funds American Balanced Fund $35.29 0.96 - 226.66B 0.876
CLBAX American Funds American Balanced 529A $35.23 0.96 - 226.66B 0.763
RLBGX American Funds American Balanced Fund Class R-6 $35.32 0.96 - 226.66B 0.876
AMBFX American Balanced Fund Class F-2 Shs $35.28 0.96 - 226.66B 0.843
OR.PA L'Oréal S.A. $412.6 0.717 245.92K 220.63B 6.6
NVS Novartis AG $111.7 0.491 1.51M 218.54B 3.78
SHELL.AS Shell plc $33.55 0.549 3.62M 215.28B 1.29
RY.TO Royal Bank of Canada $151.58 0.842 3.85M 214.06B 5.68
LIN Linde plc $440.7 0.944 1.52M 211.85B 5.56
TMUS T-Mobile US, Inc. $179.54 0.506 2.98M 210.39B 2.6
TMO Thermo Fisher Scientific Inc. $548.09 0.771 940.71K 209.21B 1.56
VEMRX Vanguard Emerging Mkts Stock Idx InsPlus $95.96 0.87 - 204.65B 2.59
CSCO Cisco Systems, Inc. $47.38 0.844 20.88M 190.89B 1.6
PDD PDD Holdings Inc. $142.42 0.615 8.33M 189.22B 0
TXN Texas Instruments Incorporated $201.87 0.974 3.67M 183.8B 5.2
MCD McDonald's Corporation $253.9 0.709 4.52M 183.06B 6.68
DHR Danaher Corporation $246.7 0.861 2.14M 182.73B 1.08
ABT Abbott Laboratories $104.22 0.718 4.26M 181.3B 2.2
AMGN Amgen Inc. $330.83 0.58 2.16M 177.47B 9
VZ Verizon Communications Inc. $41.43 0.393 11.06M 174.39B 2.66
BABA Alibaba Group Holding Limited $79.65 0.318 14.77M 171.74B 2
IBM International Business Machines Corporation $182.83 0.706 4.46M 167.95B 6.68
PM Philip Morris International Inc. $105.95 0.6 3.52M 164.71B 5.2
PFE Pfizer Inc. $28.92 0.634 28.15M 163.88B 1.68
TTE TotalEnergies SE $69.33 0.754 821.38K 163.76B 3.39
HSBC HSBC Holdings plc $43.78 0.558 1.01M 162.39B 3.05
RY Royal Bank of Canada $111.21 0.842 692.69K 157.05B 4.14
NEE NextEra Energy, Inc. $76 0.538 10.88M 156.14B 2.06
NOW ServiceNow, Inc. $758.49 0.993 730.06K 155.49B 0
PONPX PIMCO Income Fund $10.61 0.78 - 153.61B 0.54
PIMIX PIMCO Income Fund Institutional Class $10.61 0.78 - 153.61B 0.55
BHP BHP Group Limited $59.27 0.871 2.58M 150.25B 3.04
TTE.PA TotalEnergies SE $63.5 0.754 3.14M 149.98B 3.16
HDB HDFC Bank Limited $60.44 0.832 1.35M 147.61B 1.4
RICAX American Funds Investment Company of America Class R-1 $57.82 0.91 - 144.87B 0.337
RICBX American Funds Invmt Co of Amer R2 $57.91 0.91 - 144.87B 0.331
AICFX American Funds Investment Co of America Cl F-1 Shs $58.27 0.91 - 144.85B 0.692
AIVSX American Funds Invmt Co of Amer A $58.48 0.91 - 144.5B 0.7250000000000001
AICCX American Funds Investment Co of America C $57.64 0.91 - 144.5B 0.339
CICAX American Funds Invmt Co of Amer 529A $58.27 0.91 - 144.5B 0.705
FFICX American Funds Invmt Co of Amer F3 $58.44 0.91 - 144.5B 0.8820000000000001
UL Unilever PLC $57.61 0.181 3.25M 143.62B 1.84
AWSHX American Funds Washington Mutual Investors Fund Class A $61.81 0.82 - 138.82B 0.958
RWMFX American Funds Washington Mutual Investors Fund Class R-5 $61.77 0.82 - 138.73B 1.1059999999999999
CWMAX American Funds Washington Mutual Investors Fund Class 529-A $61.61 0.82 - 138.37B 0.937
WSHFX Washington Mutual Invs Fund Cl F-1 Shs $61.48 0.82 - 138.08B 0.9240000000000002
RFNCX American Funds Fundamental Invs R3 $83.03 0.96 - 136.62B 0.596
WSHCX American Funds Washington Mutual Investors Fund Class C $60.66 0.82 - 136.24B 0.526
TD.TO The Toronto-Dominion Bank $77.37 0.806 13.14M 136.12B 4.08
ANCFX American Funds Fundamental Investors $83.31 0.96 - 136.03B 0.8380000000000001
CFNAX American Funds Fundamental Investors Class 529-A $83.12 0.96 - 136.03B 0.81
FUNFX American Funds Fundamental Invs F3 $83.26 0.96 - 136.03B 1.069
AFIFX Fundamental Investors, Class F01 Shares $83.26 0.96 - 136.03B 0.799
RWMBX American Funds Washington Mutual Investors Fund $60.5 0.82 - 135.88B 0.518
T AT&T Inc. $18.81 0.72 37.78M 134.87B 1.11
RTX Raytheon Technologies Corporation $101.28 0.545 5.83M 134.65B 2.52
SCHW The Charles Schwab Corporation $75.38 0.986 6.27M 133.97B 1
UNA.AS Unilever PLC $52.78 0.181 860.3K 131.58B 1.71
SU.PA Schneider Electric S.E. $234.9 0.979 644.24K 131.46B 3.5
MUFG Mitsubishi UFJ Financial Group, Inc. $11.07 0.615 1.15M 129.39B 0.27
SYK Stryker Corporation $339.37 0.9 615.5K 129.28B 3.2
TJX The TJX Companies, Inc. $114.3 0.884 3.85M 129.18B 1.5
SNY Sanofi $51.33 0.408 1.57M 128.62B 2.04
VRTX Vertex Pharmaceuticals Incorporated $488.74 0.392 837.28K 126.12B 0

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.