Portfolio Beta Calculator

Combine each holding's individual beta, weighted by its dollar value, to estimate how sensitive your overall portfolio is to broad market moves.

Quick Facts

Formula
Portfolio Beta = Σ (Weight × Beta)
Each holding's weight is its dollar value divided by total portfolio value.
Benchmark
Beta = 1.0 is market-matching
Above 1.0 implies larger swings than the market; below 1.0 implies smaller swings.
Scope
Beta measures systematic risk only
It excludes company-specific (unsystematic) risk, which diversification can reduce.

Your Results

Calculated
Portfolio Beta
-
Value-weighted average of your holdings' beta
Total Portfolio Value
-
Sum of all holding values entered
Market Sensitivity
-
Extra move vs. a 1% market move, relative to beta 1.0
Risk Classification
-
Interpretation based on portfolio beta

Ready

Enter each holding's value and beta, then press Calculate.

How the Portfolio Beta Calculator works

Beta measures how sensitive an investment's returns are to swings in the overall market. A single stock's beta is normally found by regressing its historical returns against a benchmark index like the S&P 500. Portfolio beta extends that idea to a whole portfolio: it is simply the value-weighted average of the beta of every holding you own.

The formula

For a portfolio of holdings with betas β₁, β₂, β₃... and dollar values V₁, V₂, V₃..., each holding's weight is Wᵢ = Vᵢ / Total Value, and the portfolio beta is:

Portfolio Beta = Σ (Wᵢ × βᵢ) = W₁β₁ + W₂β₂ + W₃β₃ + ...

Larger positions pull the average toward their own beta more than smaller ones — a $50,000 holding with a beta of 1.5 moves the portfolio average far more than a $2,000 holding with the same beta.

Worked example

Say you hold $15,000 of a growth stock with beta 1.35, $10,000 of a defensive utility stock with beta 0.75, and $5,000 of a broad index fund with beta 1.05. Total value is $30,000, so the weights are 0.50, 0.333, and 0.167. The portfolio beta is (0.50 × 1.35) + (0.333 × 0.75) + (0.167 × 1.05) ≈ 1.10 — slightly more volatile than the market as a whole.

Reading the result

  • Beta > 1.0: the portfolio has historically amplified market moves — larger gains in rallies, larger losses in downturns.
  • Beta ≈ 1.0: the portfolio has tended to track the benchmark closely.
  • 0 < Beta < 1.0: the portfolio has historically dampened market moves, common for portfolios weighted toward defensive or low-volatility sectors.
  • Beta < 0: rare, and implies the portfolio has tended to move opposite the broader market (some hedges and inverse funds exhibit this).

What beta does not tell you

Beta only captures systematic (market-wide) risk. It says nothing about a company's balance sheet, sector concentration, or the odds of a single-stock event like an earnings miss or lawsuit — that unsystematic risk is what diversification, not beta, is meant to manage. Beta is also a historical, benchmark-relative measure: it describes past sensitivity, not a guarantee of future behavior, and it can drift as a company's business or leverage changes. Treat this calculator's output as a planning estimate, not investment advice.

Frequently Asked Questions

How is portfolio beta calculated?
Portfolio beta is the value-weighted average of each holding's individual beta: Portfolio Beta = Σ (Weight × Beta), where each holding's weight equals its dollar value divided by the total portfolio value. This calculator multiplies each holding's value by its beta, sums the products, and divides by the total portfolio value.
What does a portfolio beta of 1.0 mean?
A beta of 1.0 means the portfolio has historically tended to move in line with its market benchmark, such as the S&P 500. A beta above 1.0 suggests larger swings than the market, a beta between 0 and 1.0 suggests smaller swings, and a negative beta implies the portfolio has tended to move opposite the market.
Where do individual beta values come from?
Beta is typically estimated by regressing an asset's historical returns against a market index's returns, often using several years of monthly data, and is published by most financial data and brokerage platforms alongside a stock's quote. This calculator takes the beta values you supply for each holding and combines them by dollar weight.
Does portfolio beta measure total risk?
No. Beta only measures systematic (market) risk, the portion of volatility tied to broad market moves. It does not capture unsystematic risk specific to individual holdings, such as company news or sector shocks, which diversification can reduce but beta alone does not quantify.

Related calculators