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Beta coefficient

The Beta coefficient , in terms of finance and investing, is a measure of a stock (or portfolio)’s volatility in relation to the rest of the market. Beta is calculated for individual companies using regression analysis. (See Investing below)

The beta coefficient is a key parameter in the capital asset pricing model(CAPM). It measures the part of the asset's statistical variance that cannot be mitigated by the diversification provided by the portfolio of many risky assets, because it is correlated with the return of the other assets that are in the portfolio. Read on...

20 Stock-Investing Tips

Morningstar has compiled a list of 20 stock-investing tips that they suggest for individual investors. In a way, it's a summary of the value-investing philosophy they follow and I find it to be a handy list to keep around when I need a reminder of what a sound investing process should be based upon.

So, without further ado, here is the list:

1. Keep It Simple.

Keeping it simple in investing is not stupid. Seventeenth-century philosopher Blaise Pascal once said, "All man's miseries derive from not being able to sit quietly in a room alone." This aptly describes the investing process.

Those who trade too often, focus on irrelevant data points, or try to predict the unpredictable are likely to encounter some unpleasant surprises when investing. By keeping it simple - focusing on companies with economic moats, requiring a margin of safety when buying, and investing with a long-term horizon - you can greatly enhance your odds of success. Read on...