Best Buy Co Stock Volatility

BBY Stock  USD 77.13  0.89  1.14%   
We consider Best Buy very steady. Best Buy secures Sharpe Ratio (or Efficiency) of 0.0284, which signifies that the company had 0.0284% return per unit of risk over the last 3 months. Our standpoint towards foreseeing the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-nine technical indicators for Best Buy Co, which you can use to evaluate the future volatility of the firm. Please confirm Best Buy's Downside Deviation of 1.68, mean deviation of 1.27, and Risk Adjusted Performance of 0.0397 to double-check if the risk estimate we provide is consistent with the expected return of 0.0462%. Key indicators related to Best Buy's volatility include:
480 Days Market Risk
Chance Of Distress
480 Days Economic Sensitivity
Best Buy Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Best daily returns, and it is calculated using variance and standard deviation. We also use Best's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Best Buy volatility.
  

ESG Sustainability

While most ESG disclosures are voluntary, Best Buy's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Best Buy's managers and investors.
Environment Score
Governance Score
Social Score
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Best Buy can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Best Buy at lower prices. For example, an investor can purchase Best stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Best Buy's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Best Stock

  0.63W Wayfair Financial Report 2nd of May 2024 PairCorr
  0.65AN AutoNation Financial Report 18th of April 2024 PairCorr

Best Buy Market Sensitivity And Downside Risk

Best Buy's beta coefficient measures the volatility of Best stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Best stock's returns against your selected market. In other words, Best Buy's beta of 1.53 provides an investor with an approximation of how much risk Best Buy stock can potentially add to one of your existing portfolios.
Best Buy Co has relatively low volatility with skewness of 0.81 and kurtosis of 2.76. However, we advise all investors to independently investigate Best Buy Co to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Best Buy's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Best Buy's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
3 Months Beta |Analyze Best Buy Demand Trend
Check current 90 days Best Buy correlation with market (NYSE Composite)

Best Beta

    
  1.53  
Best standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  1.63  
It is essential to understand the difference between upside risk (as represented by Best Buy's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Best Buy's daily returns or price. Since the actual investment returns on holding a position in best stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Best Buy.

Using Best Put Option to Manage Risk

Put options written on Best Buy grant holders of the option the right to sell a specified amount of Best Buy at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Best Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Best Buy's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Best Buy will be realized, the loss incurred will be offset by the profits made with the option trade.

Best Buy's PUT expiring on 2024-03-22

   Profit   
       Best Buy Price At Expiration  

Current Best Buy Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2024-03-22 PUT at $84.0-0.73960.0347272024-03-227.55 - 8.957.33View
Put
2024-03-22 PUT at $83.0-0.7470.040512024-03-226.6 - 7.46.24View
Put
2024-03-22 PUT at $82.0-0.72920.0461122024-03-224.95 - 7.053.3View
Put
2024-03-22 PUT at $81.0-0.64920.043222024-03-224.65 - 6.94.68View
Put
2024-03-22 PUT at $80.0-0.68160.0645602024-03-222.98 - 4.953.73View
Put
2024-03-22 PUT at $79.0-0.61250.0671922024-03-222.86 - 3.852.58View
Put
2024-03-22 PUT at $78.0-0.57230.09532352024-03-222.01 - 2.231.76View
Put
2024-03-22 PUT at $77.0-0.4760.10433962024-03-221.41 - 1.51.25View
Put
2024-03-22 PUT at $76.0-0.36330.10743992024-03-220.88 - 0.970.89View
Put
2024-03-22 PUT at $75.0-0.25460.09463822024-03-220.51 - 0.580.53View
Put
2024-03-22 PUT at $74.0-0.16640.07381222024-03-220.28 - 0.330.24View
View All Best Buy Options

Best Buy Stock Volatility Analysis

Volatility refers to the frequency at which Best Buy stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Best Buy's price changes. Investors will then calculate the volatility of Best Buy's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Best Buy's volatility:

Historical Volatility

This type of stock volatility measures Best Buy's fluctuations based on previous trends. It's commonly used to predict Best Buy's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Best Buy's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Best Buy's to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Best Buy Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.

Best Buy Projected Return Density Against Market

Considering the 90-day investment horizon the stock has the beta coefficient of 1.5312 suggesting as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Best Buy will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Best Buy or Specialty Retail sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Best Buy's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Best stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has a negative alpha, implying that the risk taken by holding this instrument is not justified. Best Buy is significantly underperforming NYSE Composite.
   Predicted Return Density   
       Returns  
Best Buy's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how best stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Best Buy Price Volatility?

Several factors can influence a stock's market volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Best Buy Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Best Buy or Specialty Retail sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Best Buy's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Best stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Considering the 90-day investment horizon the coefficient of variation of Best Buy is 3523.46. The daily returns are distributed with a variance of 2.65 and standard deviation of 1.63. The mean deviation of Best Buy Co is currently at 1.21. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.63
α
Alpha over NYSE Composite
-0.12
β
Beta against NYSE Composite1.53
σ
Overall volatility
1.63
Ir
Information ratio -0.03

Best Buy Stock Return Volatility

Best Buy historical daily return volatility represents how much of Best Buy stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company has volatility of 1.6291% on return distribution over 90 days investment horizon. By contrast, NYSE Composite accepts 0.5638% volatility on return distribution over the 90 days horizon.
 Performance 
       Timeline  

About Best Buy Volatility

Volatility is a rate at which the price of Best Buy or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Best Buy may increase or decrease. In other words, similar to Best's beta indicator, it measures the risk of Best Buy and helps estimate the fluctuations that may happen in a short period of time. So if prices of Best Buy fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Best Buy Co., Inc. retails technology products in the United States and Canada. The company was incorporated in 1966 and is headquartered in Richfield, Minnesota. Best Buy operates under Specialty Retail classification in the United States and is traded on New York Stock Exchange. It employs 57750 people.
Best Buy's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Best Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Best Buy's price varies over time.

3 ways to utilize Best Buy's volatility to invest better

Higher Best Buy's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Best Buy stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Best Buy stock volatility can provide helpful information for making investment decisions in the following ways:
  • Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Best Buy investment. A higher volatility means higher risk and potentially larger changes in value.
  • Identifying Opportunities: High volatility in Best Buy's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
  • Diversification: Understanding how the volatility of Best Buy's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Remember it's essential to remember that stock volatility is just one of many factors to consider when making investment decisions, and it should be used in conjunction with other fundamental and technical analysis tools.

Best Buy Investment Opportunity

Best Buy Co has a volatility of 1.63 and is 2.91 times more volatile than NYSE Composite. 14  of all equities and portfolios are less risky than Best Buy. Compared to the overall equity markets, volatility of historical daily returns of Best Buy Co is lower than 14 () of all global equities and portfolios over the last 90 days. Use Best Buy Co to protect your portfolios against small market fluctuations. Benchmarks are essential to demonstrate the utility of optimization algorithms. The stock experiences a somewhat bearish sentiment, but the market may correct it shortly. Check odds of Best Buy to be traded at $74.82 in 90 days.

Very weak diversification

The correlation between Best Buy Co and NYA is 0.53 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Best Buy Co and NYA in the same portfolio, assuming nothing else is changed.

Best Buy Additional Risk Indicators

The analysis of Best Buy's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Best Buy's investment and either accepting that risk or mitigating it. Along with some common measures of Best Buy stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Best Buy Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Best Buy as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Best Buy's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Best Buy's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Best Buy Co.
When determining whether Best Buy offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Best Buy's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Best Buy Co Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Best Buy Co Stock:
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Best Buy Co. Also, note that the market value of any Company could be tightly coupled with the direction of predictive economic indicators such as signals in bureau of labor statistics.
Note that the Best Buy information on this page should be used as a complementary analysis to other Best Buy's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

Complementary Tools for Best Stock analysis

When running Best Buy's price analysis, check to measure Best Buy's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Best Buy is operating at the current time. Most of Best Buy's value examination focuses on studying past and present price action to predict the probability of Best Buy's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Best Buy's price. Additionally, you may evaluate how the addition of Best Buy to your portfolios can decrease your overall portfolio volatility.
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Is Best Buy's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Best Buy. If investors know Best will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Best Buy listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.05)
Dividend Share
3.68
Earnings Share
5.68
Revenue Per Share
199.596
Quarterly Revenue Growth
(0.01)
The market value of Best Buy is measured differently than its book value, which is the value of Best that is recorded on the company's balance sheet. Investors also form their own opinion of Best Buy's value that differs from its market value or its book value, called intrinsic value, which is Best Buy's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Best Buy's market value can be influenced by many factors that don't directly affect Best Buy's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Best Buy's value and its price as these two are different measures arrived at by different means. Investors typically determine if Best Buy is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Best Buy's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.