Market Beta – Strategy Revealed

Dear Profit Takeover reader,

I missed you since we didn’t have a Profit Takeover show this morning,

But I wanted to share an important strategy I will be using through earnings to bulletproof our Profit Revolution portfolio…

Using market beta to find opportunity.

Beta is the volatility of individual stocks compared to the volatility of the overall market…

For instance, a stock with a beta of .5 would be half as volatile as the market – or a beta of 2 means the stock would be twice as volatile as the overall market.

Take a look at SPY – SPDR S&P 500 ETF Trust (NYSEARCA:SPY)…

Image from Yahoo Finance

Because SPY is an ETF that mirrors the S&P 500, its Beta is 1 – as its volatility will follow that of the market.

But today, I want to tell you about an oil stock with a Beta of 2.5…

Meaning it is more than TWICE as volatile as the market.

USO – United States Oil ETF (NYSEARCA:USO)…

Image from Yahoo Finance

USO’s beta is 2.60 – which means it’s 2.6 times more volatile than the market…

And you know what I say about volatility…

Volatility = Opportunity

Over double the volatility in USO means double the opportunity for asymmetric profit…

Understanding volatility and beta is paramount in order to make these oil earnings trades –

I will be walking traders through every step of the way during the Profit Revolution live shows every week day as we trade these names…

and more…

If you haven’t already become a Profit Revolutionary –

Join us RIGHT HERE –

And trade earnings with the Profit Revolution:

Monday through Thursday at 2:15 p.m. (ET) and

Friday at 12:00 noon (ET).

Until next time,

Mark Sebastian
Founder, Profit Takeover

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