Portfolio Beta Formula: Learn the Basics of Forex Trading

Estimated read time 4 min read

Portfolio Beta is a metric used by Forex traders to measure the impact a single trade has on the overall investment portfolio. It measures the correlation between any given trade’s returns and the total portfolio’s returns. A Beta of 1.0 indicates that the trade is perfectly correlated with the total portfolio’s returns, while lower or higher values indicate a higher or lower correlation. Portfolio Beta is a powerful tool for traders to assess the overall risk level of a given trade and to optimize their trading strategies.