Custom Beta One Year Formula in Excel
Start measuring your stock’s volatility relative to the market over the past year with the Custom Beta One Year formula in Excel (powered by MarketXLS). This function calculates a stock’s one-year beta against a chosen benchmark, helping you analyze risk and performance with ease.
Understanding Custom Beta One Year
- Purpose: The
CustomBetaOneYear
function computes a stock’s beta value over a one-year period, comparing returns against a specified benchmark. - Key Benefits:
- Quickly evaluate how volatile a stock is relative to a market index or another stock.
- Make data-driven decisions about portfolio risk.
- Seamless integration with MarketXLS.
- When to Use:
- Assess risk before adjusting portfolio positions.
- Compare multiple stocks or ETFs to identify potential under- or over-performers.
Syntax and Parameters
=CustomBetaOneYear(Symbol, [symbol_Benchmark], [ReturnPeriod])
Parameter | Description | Required | Example |
---|---|---|---|
Symbol |
The ticker symbol for the security to calculate the beta for. | Yes | "MSFT", "^SPX", "BTCUSD:DEFAULT" |
symbol_Benchmark |
The benchmark symbol. Defaults to "SPY" if left blank. | No | "AAPL", "^SPX" |
ReturnPeriod |
The frequency of returns used for calculation: can be daily , weekly , or monthly . Defaults to daily . |
No | "weekly" |
Return Value:
- Returns a numeric beta value. Higher than 1 indicates the security is more volatile than the benchmark; lower than 1 indicates it is less volatile.
?? Note: If the symbol is invalid, the function will return
"NA"
. The function also checks for a valid MarketXLS license.
Examples and Usage
Below are practical ways to use CustomBetaOneYear
in Excel:
-
Basic Daily Beta Calculation
=CustomBetaOneYear("MSFT")
Calculates MSFT’s one-year beta relative to the default SPY benchmark on a daily basis.
-
Comparing Against a Different Stock
=CustomBetaOneYear("MSFT","AAPL")
Compares MSFT’s volatility directly against AAPL.
-
Monthly Return Frequency
=CustomBetaOneYear("MSFT","AAPL","monthly")
Uses monthly returns data for the past year to compute beta.
-
Weekly Return Frequency
=CustomBetaOneYear("MSFT","AAPL","weekly")
Calculates beta using weekly returns to smooth out daily volatility.
? Pro Tip: Use different benchmarks (e.g.,
^SPX
for the S&P 500) to gauge how your chosen stock compares against various market indices.
Error Handling and Special Cases
- Returns
"NA"
if an invalid ticker is provided or if there is a licensing issue. - If
symbol_Benchmark
is not specified, it defaults to"SPY"
. - If
ReturnPeriod
is not specified or invalid, it defaults to"daily"
. - Calculation is based on one year of historical data from today’s date, so custom date inputs are not applicable to this function.
Performance Considerations
- The function queries MarketXLS data in real-time. When retrieving large data sets or during peak usage, performance may be slower.
- Ensure a stable internet connection for seamless data retrieval.
Common Questions
-
Can I specify a custom date range for the beta calculation?
- Not with
CustomBetaOneYear
. It automatically calculates beta for the past year.
- Not with
-
Why am I getting “NA”?
- Make sure the
Symbol
is valid and that your MarketXLS license is active. If you’re still seeing “NA,” confirm your internet connection.
- Make sure the
-
Which ReturnPeriod should I use?
daily
for detailed short-term analysis,weekly
ormonthly
to reduce noise and smooth out volatility fluctuations.
-
Can I compare multiple stocks at once?
- Yes. By changing the
symbol_Benchmark
parameter, you can quickly compare each security against different benchmarks in separate cells.
- Yes. By changing the
?? Note: Values are typically updated daily around market close and may not reflect real-time intraday changes.
Use the Custom Beta One Year formula to gain insights into your portfolio’s risk profile and make confidently informed investment decisions.