The Beta Coefficient measures the systematic risk of a security. It is used to illustrate the relative volatility of a security (or portfolio) in comparison with the market as a whole. As the benchmark of this measurement, the market is defined of having a beta of 1.0.

A security with a Beta value >1.0 is indicative of a security that is more volatile than the market. A Beta <1.0 is then less volatile than the market. If the Beta = 1.0, the security's price is said to move along with the market.