Let’s summarize the main differences between alpha and beta. Note that in a given trading scenario, there may be fewer or greater considerations, and not every difference may be material in any ...

'Alpha’ tells investors how a security has historically performed vs. a benchmark while ‘beta’ shows volatility over time vs. the market. Learn more about their differences and uses.

CAPM Example . Imagine an investor is contemplating a stock valued at $100 per share today that pays a 3% annual dividend.Say this stock has a beta compared with the market of 1.3, which means it ...