Beta is a measure of how volatile a company’s share price is relative to an index. A beta of one means that the share price moves in-line the index. A beta greater than one means the share price outperforms a rising market and underperforms a falling market. A beta less than one means that the share price doesn’t rise as fast as the rising market and doesn’t fall as fast as a falling one. Betas are worked out using historical data and, in our opinion, this means they don’t work well in the real world as companies’ circumstances change over time.