Beta coefficient, also known as beta coefficient, is a risk index to measure the price fluctuation of individual stocks or stock funds relative to the whole stock market. β coefficient is a tool to evaluate the systemic risk of securities, which is used to measure the volatility of a securities or portfolio relative to the overall market. Common investment terms such as stocks and funds. The systematic risk of a single asset is measured by β coefficient. Taking the whole market as a reference, compare the risk return rate of a single asset with the average risk return rate of the whole market, that is, the β calculation formula? Where Cov(ra, rm) is the covariance between the return of security A and the market return; ? Is the variance of market returns. Because: Cov(ra, rm) = ρamσaσm, the formula can also be written as:? β formula, where ρam is the correlation coefficient between securities A and the market; σa is the standard deviation of security A; σm is the standard deviation of the market. According to this formula, the beta coefficient does not represent the direct relationship between the fluctuation of securities prices and the fluctuation of the overall market. It cannot be absolutely said that the greater β is, the greater the fluctuation of securities price (σa) relative to the overall fluctuation of the market (σm); Similarly, the smaller β is, it doesn't completely mean that σa is less than σ M. Even if β = 0, it doesn't mean that the securities are risk-free, but it may be that the fluctuation of securities prices has nothing to do with the fluctuation of market prices (ρam= 0), but it can be determined that if the securities are risk-free (σa), β must be zero. Note: Knowing the meaning of β value ◆ β= 1 means that the risk return rate of this single asset changes in the same proportion as the average risk return rate of market portfolio, and its risk situation is consistent with that of market portfolio; ◆β& gt； 1, indicating that the risk return rate of this single asset is higher than the average risk return rate of market portfolio, so the risk of this single asset is greater than that of the whole market portfolio; ◆β& lt； 1, indicating that the risk return rate of this single asset is less than the average risk return rate of market portfolio, so the risk degree of this single asset is less than that of the whole market portfolio. Summary: 1)β value is an index to measure systemic risk, and 2)β coefficient can be calculated in two ways. The beta coefficient formula used in the securities market is as follows: Cov(ra, rm) is the covariance between the return of securities A and the market return; Is the variance of market returns. Because: Cov(ra, rm) = ρamσaσm, the formula can also be written as follows: ρam is the correlation coefficient between securities A and the market; σa is the standard deviation of security A; σm is the standard deviation of the market. The beta coefficient is calculated by regression method: the beta coefficient is equal to 1, that is, the securities price changes with the market. Beta coefficient is higher than 1, that is, the stock price fluctuates more than the whole market. Beta coefficient is lower than 1, that is, the volatility of securities prices is lower than that of the market. If β = 0 means there is no risk, β = 0.5 means its risk is only half that of the market, β = 1 means its risk is the same as that of the market, and β = 2 means its risk is twice that of the market.