Zacks.com Featured Highlights Include: Rent-A-Center, Abercrombie, Upland, Valero And Exponent
Zacks Investment Research | Jan 03, 2019 09:44PM ET
For Immediate Release
Chicago, IL – January 4, 2019 - Stocks in this week’s article are Rent-A-Center, Inc. (NASDAQ:RCII) , Abercrombie & Fitch Company (NYSE:ANF) , Upland Software (NASDAQ:UPLD) , Valero Energy (NYSE:VLO) Partners LP (NYSE:VLP) and Exponent, Inc. (NASDAQ:EXPO) .
Buy These 5 Low-Beta Stocks to Withstand Market Volatility
Most investors believe that only risky stocks can generate healthy returns. Those securities perform extremely well when the market is bullish. However, since the performances of risky stocks are positively correlated with market movements, the converse scenario should also be taken into account.
After thorough research and analysis, we have developed a strategy which testifies that low-risk stocks can also fetch lucrative returns when some other parameters are considered.
Meaning of Beta
Beta indicates the volatility of a particular stock with respect to the market. In other words, beta measures the extent of stock price movement relative to the market (we are considering S&P 500 here).
If a company has a beta of 1, it means that the relative volatility of the stock is the same as that of the S&P 500. In the same way, if the stock’s beta is greater than 1 then it is more volatile compared to the market. Conversely, a beta below 1 signifies less volatility.
Now, if a portfolio’s beta is 3, it is three times more volatile than the market. Hence, if the market is projected to give 20% return, the portfolio will then definitely contribute 60% return which is amazing.
However, the opposite case also holds true. If the market slips 20% then the portfolio return plummets 60% which is surely a matter of concern.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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