The beta value of Hindustan Unilever Ltd. (HUL) varies depending on the period over which it is calculated. Specifically, HUL has a Long Term Beta of 0.735 and a Daily - One Month Range Beta of 0.902.
Understanding Beta
Beta is a key financial metric used to measure the volatility or systematic risk of a stock or portfolio in comparison to the overall market. It indicates how much a stock's price is expected to move relative to the market's movements.
- A beta of 1.0 signifies that the stock's price tends to move in line with the market.
- A beta greater than 1.0 suggests the stock is more volatile than the market, potentially experiencing larger price swings.
- A beta less than 1.0 indicates that the stock is less volatile than the market, typically exhibiting smaller price fluctuations.
Beta Values for Hindustan Unilever Ltd.
Hindustan Unilever Ltd. (HUL) exhibits different beta values when analyzed over various timeframes, reflecting its stability relative to broader market movements. The specific beta values are:
| Period | Beta Value |
|---|---|
| Long Term | 0.735 |
| Daily - One Month Range | 0.902 |
Interpreting HUL's Beta
Both beta values for HUL are less than 1, which generally indicates that the stock is less volatile than the broader market. This characteristic suggests that HUL's price movements are typically more stable and less reactive to overall market fluctuations compared to many other stocks.
- The Long Term Beta of 0.735 points to consistent, lower-than-market volatility over an extended period. This can make HUL an attractive option for investors looking for stability in their portfolio.
- The Daily - One Month Range Beta of 0.902, while still below 1, is slightly higher than the long-term beta. This indicates that in shorter, more recent periods (such as daily to one-month intervals), HUL's price movements might be marginally more correlated with market shifts compared to its overall long-term trend, yet still retaining its characteristic as a relatively defensive stock.
This lower beta characteristic often appeals to investors seeking more stable assets, particularly during periods of market uncertainty, as stocks with lower betas tend to experience smaller price swings and can provide a degree of portfolio stability.
