Beta Value a Measure of Stock Volatility; Roundup of S&P 500 Top Five Volatile Stocks – AIG, GNW, HIG, WYN, PFG

  on Dec 17,2012 Posted in Finance ,Investment Ideas
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Beta factor is a measure of the risk of a security when it is included in a well-diversified portfolio. The Capital Asset Pricing Model (CAPM) breaks down anticipated stock returns into 2 parts according to financial theory.

CAPM measures two types of risks, systematic and unsystematic risk. Beta value of a security is the gauge of the volatility of a security in comparison to the volatility of the market.

Beat is a simple and very useful indicator that all traders and investors should be aware of. Beta value calculation for stock is essential with many trading/investing strategies particularly with Capital Asset Pricing Model (CAPM).

In this article we will discuss top five risky stocks of S&P 500 components. Earlier we discussed over views about RSI analysis of blue chip stocks.

American International Group, Inc (NYSE:AIG) leads the group of most volatile stocks among S&P 500 stocks. The company has the market capitalization of 50.11 billion while 1.48 billion shares were outstanding. Beta factor, which measures the riskiness of the security, was booked as 3.44. Net profit margin of the company was 38.83% while operating profit margin was 16.70%.

Genworth Financial Inc (NYSE:GNW) has the market capitalization of 3.42 billion. The corporation has 491.8 million shares outstanding and 76% stock of the company was owned by institutional investors. GNW has 11.49 value in P/E ratio while price to book ratio was recorded as 0.21. The company earned $299 million in previous year on revenue of $10.11 billion.

Hartford Financial Services Group Inc (NYSE:HIG) has the market capitalization of 9.29 billion while its EPS was booked as 0.96. HIG has 436.31 million shares outstanding while 95% shares of the company were owned by institutions investors. In the profitability analysis, Hartford Financial Services has operating profit margin of 1.46% while net profit margin was 2.16%. Beta value of the company was 3.00; beta is used to measure riskiness of the security.

Wyndham Worldwide Corporation (NYSE:WYN) was offering 1.83% dividend yield per annum. The company has the market capitalization of 7.05 billion while 140.27 million shares were outstanding. WYN offered Net profit margin of 8.42% while its operating profit margin was 15.68%. ROE was booked as 16.90% while beta factor was 2.92.

Principal Financial Group Inc (NYSE:PFG) has beta value of 2.75. The company has the market capitalization of 8.08 billion. ROA ratio of the company was 0.51% while its ROE ratio was 7.25%. ATR value of company was 0.45 while stock volatility for week was 1.31% while for month was 1.44%. Debt to equity ratio of the company was 0.22.

Disclosure: The views and opinions expressed in this article are exclusively those of the authors who have no stake in any stocks mentioned, and hold no plan to acquire any stake within the next 5 days.



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