Stocks Ranked by Volatility

stocks ranked by volatility

Learn to find stocks ranked by volatility… and what that means for your portfolio…

Stocks Ranked by Volatility can present interesting trading opportunities. So in this blog post we’ll look at two of the most common measures of volatility that can be of use to stock traders. Then you should be well-prepared to find stocks ranked by volatility (and the trading opportunities that follow). Sound good?

And in case you’re unsure…

Volatility in stocks is basically a measure of how much their prices change over time. There are a number of things that influence the volatility of a stock. But the take home point for investors is that volatile stocks can be emotionally difficult to bear because of the large price swings that ensue. On the other hand, shorter term traders often look for volatility to try and make profit around these large moves. Now I assume if you’re looking for stocks ranked by volatility it’s this profit opportunity that you’re interested in, so that’s what we’ll look at next…

Relative Volatility – Stocks Ranked by Beta:

The most common way to ranks stocks by volatility is using the Beta. Beta is a measure of how much a given stock moves relative to a benchmark, like the S&P-500. Easy enough, right? ¬†So let’s look at some specifics of using Beta to rank stocks by volatility…

If you’re ranking stocks by volatility then you should know that a Beta of 1.0 means the stock moves with the same volatility as the benchmarked index. A Beta above 1 indicates that the stock is more volatile whereas a Beta value between 1 and 0 indicates the stock is less volatile than the index. A negative Beta indicates an inverse correlation to the index. Got it?

Now here’s a list of the highest Beta Stocks. The Finviz stock screener is great for ranking stocks by Beta. You can save that screen yourself or alter it to rank stocks by volatility, based on your own goals and risk profiles. But hey…

Beta isn’t the only way to rank stocks by volatility. Because since volatility is a measure of price change over time, you can just measure how much price has changed over a given time. For instance, here are stocks ranked by volatility of over 15% in a month. Cool right? And again…

You can change the time and % change to tweak the list of volatile stocks to meet your goals (which might be lots of volatility if you’re a trader, or low volatility if you’re an investor). But there’s one more really interesting way to rank stocks by volatility…

Absolute Volatility – Stocks Ranked by Average True Range:

Ranking stocks by volatility doesn’t have to just do with Beta. This is especially true if you’re looking for stocks ranked by absolute volatility (instead of volatility relative to a benchmark). In the case of absolute volatility, I really like to use average true range (ATR). So how do you use ATR?

ATR is basically an exponential moving average that tells you in absolute terms (dollar values) how much a stock has moved over the period the moving average is measured (typically 14 days). So basically the default of ATR (14) measures the volatility of stocks based on the dollar amount of their price fluctuations. You can rank stocks by high ATR volatility so that you can capture big moves of over $3 every couple of weeks. Or…

If you’re a long term investor looking for a more stable portfolio who’s value won’t fluctuate like crazy, then you can rank stocks by low ATR volatility. This way you can rank stocks by volatility to be defensive and protect yourself from big swings in price, rather than just looking for quick trading profits. Make sense?

If you’re still a little confused just click on any of the links above to pull up a Finviz Stock Screener. Then you can play around with the volatility rankings yourself until you find stocks that meet your volatility criteria. Sound good? You can also watch this short video below…

Stocks Ranked by Volatility [VIDEO]:

Now that you know how to find stocks ranked by volatility using screeners like Finviz, how do you think you will use volatility indicators like Beta and ATR to improve your stock trading performance? I’d be curious to hear.

And By The Way: If you’re¬†interested in learning about more neat ways to analyze stock ideas, I encourage you to sign up using the form below. You’ll get free access to exclusive analysis that can help you improve your stock trading strategies. Check it out!

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