Best High Beta Stocks in Nifty 50

High beta stocks are a popular investment option among traders who seek higher returns. These stocks are known for their volatility and are perceived as high-risk, high-reward investments. In this blog, we will explore the meaning of high beta stocks, who can potentially invest in them, their benefits, factors to consider before investing, and a list of top high beta shares. Let’s begin with the high beta stock meaning by answering the question ‘what is high beta stocks?’. 

Top 10 High Beta Stocks in Nifty 50

Here is the list of high beta stocks:

Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.

Note: The data on the high beta stock list is dynamic and subject to real-time changes. The Nifty 50 high beta stocks have been picked from the Tickertap Stock Screener on 16th December 2024, using the following filters:

• Stock Universe: Nifty 50
• Beta: Sort from highest to lowest

🚀 Pro Tip: You can use Tickertape’s Stock Screener to research and evaluate stocks with over 200+ filters and parameters.

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Top High Beta Stocks in Nifty 50: An Overview

Here are brief overviews of the top 10 high beta Nifty 50 stocks:

Indusind Bank Ltd

IndusInd Bank is a prominent Indian financial institution known for its wide range of banking and financial services, serving both retail and corporate customers. As of 16th December 2024, this stock with high beta value had a market capitalisation of Rs. 76,681.29 cr., and its share price closed at Rs. 997.95. Furthermore, the company has a PE ratio of 8.54 and a high beta of 2.38. 

Bajaj Finserv Ltd

Bajaj Finserv Ltd is a diversified financial services company in India, offering insurance, lending, and wealth management solutions, known for its customer-centric approach. As of 16th December 2024, the company had a market capitalisation of Rs. 2,65,227.94 cr., and its share price closed at Rs. 1,679.30. Furthermore, the company had a PE ratio of 32.55 and a beta value of 1.94. 

Bajaj Finance Ltd

It is a leading non-banking financial company (NBFC) in India, specialising in consumer and small business lending, with a strong presence in the retail finance sector. As of 16th December 2024, the company had a market capitalisation of Rs. 4,29,118.40 cr., and its share price closed at Rs. 7,125.80. Furthermore, the company had a PE ratio of 29.69 and a beta of 1.88. 

Hindalco Industries Ltd

Hindalco Industries Ltd., a flagship company of the Aditya Birla Group, is one of the world’s largest integrated producers of aluminium and copper. As of 16th December 2024, the company had a market capitalisation of Rs. 1,49,564.57 cr., and its share price closed at Rs. 668.70. Furthermore, the company had a PE ratio of 29.69 and a beta of 14.73. 

Tata Motors Ltd

Tata Motors Ltd., a flagship company of the Tata Group, is one of India’s largest automobile manufacturers and a global leader in the automotive industry. As of 16th December 2024, the company had a market capitalisation of Rs. 2,94,453.18 cr., and its share price closed at Rs. 786.35. Furthermore, the company had a PE ratio of 9.38 and a beta of 1.71. 

Axis Bank Ltd

Axis Bank Ltd. is one of India’s leading private sector banks, known for its strong presence in retail, corporate, and investment banking. As of 16th December 2024, the company had a market capitalisation of Rs. 3,57,011.49 cr., and its share price closed at Rs. 1,145.65. Furthermore, the company had a PE ratio of 13.53 and a beta of 1.49. 

Tata Steel Ltd

Tata Steel Ltd is one of the world’s leading steel manufacturing companies and a flagship entity of the Tata Group. Established in 1907, Tata Steel has grown from India’s first integrated steel producer to a global steel powerhouse. As of 16th December 2024, the company had a market capitalisation of Rs. 1,87,652.45 cr., and its share price closed at Rs. 150.78. Furthermore, the company had a negative PE ratio of -42.29 and a beta of 1.46. 

Shriram Finance Ltd

Shriram Finance Limited, formerly known as Shriram Transport Finance Company, is one of India’s non-banking financial companies (NBFCs) specialising in consumer finance. As of 16th December 2024, the company had a market capitalisation of Rs. 1,19,831.13 cr., and its share price closed at Rs. 3,248.10. Furthermore, the company had a PE ratio of 16.27 and a beta of 1.45. 

Adani Enterprises Ltd

Adani Enterprises Ltd (AEL) is the flagship entity of the Adani Group, a globally integrated infrastructure and energy conglomerate based in India. As of 16th December 2024, the company had a market capitalisation of Rs. 2,84,759.47 cr., and its share price closed at Rs. 2,504.10. Furthermore, the company had a PE ratio of 87.90 and a beta of 1.38. 

Mahindra and Mahindra Ltd

Mahindra & Mahindra Ltd. (M&M) is one of India’s multinational conglomerates, with a strong presence across diverse sectors, including automotive, agriculture, finance, and technology. As of 16th December 2024, the company had a market capitalisation of Rs. 3,67,624.73 cr., and its share price closed at Rs. 3,067.45. Furthermore, the company had a PE ratio of 32.62 and a beta of 1.29.

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How to Invest in High Beta Stocks NSE?

You can invest in high beta stocks NSE through several avenues. This includes buying individual stocks through a stockbroker, investing in high beta ETFs or mutual funds for diversification, using derivatives like futures and options for more advanced strategies, or setting up systematic investment plans (SIPs) for disciplined investing. However, always research thoroughly and assess your risk tolerance when considering high beta 50 stocks list 2024 investments.

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What are High Beta Stocks?

High Beta stocks are shares with a beta coefficient greater than 1, indicating that they are more volatile than the broader market. These stocks tend to experience larger price movements in either direction compared to the market, making them high-risk, high-reward investments. 

Should You Invest in High Beta Stocks?

Investing in high beta stocks is a decision that requires careful consideration. Beta measures a stock’s volatility in relation to the market, and high beta stocks tend to experience larger price swings. While these stocks can offer higher returns in bullish markets, they also carry increased risk.

High beta stocks are often associated with sectors like technology and biotech, where rapid innovation and market sentiment heavily influence stock prices. Investors seeking potential higher returns must weigh this against the heightened risk of significant losses during market downturns.

It’s essential to align your investment strategy with your risk tolerance and financial goals. Conservative beta investors may opt for low beta stocks in Nifty 50 for more stability, while those comfortable with volatility might find high beta stocks appealing. Before deciding, thoroughly research the specific factors influencing a stock’s beta and consider consulting with a financial advisor to ensure your investment choices align with your overall financial plan.

What is Beta in Stocks?

Beta value is a measure of a stock’s volatility, and it is calculated by comparing the returns of a stock to the returns of the broader market. The beta of the broader market is defined as 1, and a stock with a beta greater than 1 is considered to be more volatile than the market, while a stock and beta less than 1 is considered to be less volatile than the market.

To calculate the higher beta of a stock, analysts typically use regression analysis to compare the returns of the stock to the returns of a relevant market index, such as the Nifty 50 index. Regression analysis involves calculating the slope of a line that represents the relationship between the stock beta returns and the returns of the market index. The slope of this line is the beta coefficient.

What is the Importance of Beta in Stock Valuation?

Beta in finance is an important factor in stock valuation because it helps investors determine the riskiness of a stock compared to the broader market. A stock’s beta measures and is an indication of how much its price is likely to move in relation to the share market, and this can help investors assess the potential risks and rewards associated with an investment in that stock. 

For example, if a stock has a good beta of 1.5, it is considered to be 50% more volatile than the broader market. This means that if the market moves up by 10%, the stock is likely to move up by 15%, and if the market moves down by 10%, the stock is likely to move down by 15%. On the other hand, if a stock has a beta of 0.5, it is considered to be 50% less volatile than the market, meaning that its price is likely to move up or down by only half as much as the market.

Who Should Invest in High Beta Stocks? 

• Investors with a high risk tolerance: Investing in high-beta shares can be suitable for investors who are willing to take on higher risks in exchange for potentially higher returns. Such investors may have a higher risk tolerance and a longer investment horizon, and they may be comfortable with the volatility that comes with investing in high-beta shares.
• Investors in high growth industries: Moreover, investors who are interested in investing in growth industries may also consider high beta shares, as these stocks often provide exposure to sectors that are expected to experience strong growth in the future.

However, it is essential to evaluate the industry trends, the company’s financial performance, and risk tolerance before investing in these stocks.

Features of the Top High Beta Stocks NSE

High Beta Stocks on the NSE, including the high beta midcap stocks, exhibit distinctive characteristics that set them apart in the market. Understanding these features is crucial for investors seeking comprehensive insights.

• Volatility Amplification: NSE High Beta Stocks tend to amplify market movements, showcasing greater price fluctuations compared to the overall market index. This heightened volatility can present both risks and opportunities for investors.
• Market Sensitivity: These stocks are highly sensitive to market trends and sentiments. As the market fluctuates, these stocks often demonstrate a magnified response, making them more reactive to economic shifts and global events.
• Aggressive Growth Potential: The elevated volatility associated with these stocks is often linked to their potential for aggressive growth. Investors in search of high-risk, high-reward opportunities may find these stocks appealing.
• Sector-Specific Trends: Certain sectors consistently host these stocks. Identifying these trends can provide a more nuanced understanding of the factors influencing the beta means values of stocks within specific industries.
• Risk Considerations: It’s crucial to note that while these stocks offer potential for increased returns, they also come with heightened risk. Investors should carefully assess their risk tolerance and investment objectives before considering these stocks.

Risks of Investing in High Beta Stocks

Though a stock’s beta signifies the volatility and risk associated with it, relying solely on it would not be a wise move. Here are why beta stocks can be risky.

Are relatively riskier

Stocks with a beta in stock market value of more than 1 are riskier as they are sensitive to market volatility. Ergo, a downturn in the stock market can impact such stocks leading to huge losses.

Have other associated risks

The market beta of a stock coefficient is the rate at which the price of a stock moves when compared to the broader market index. While this is an important indicator of the volatility concerning the stock, there can be other associated risks as well. Ergo, if you simply rely on the beta value of stocks to invest in them, you may be ignoring other red flags, such as inefficient management or operations.

Reliance on past data

The beta coefficient is calculated based on past data of stock. So, it is a good indicator of the stock’s past performance but doesn’t guarantee future performance.

Benefits of Investing in High Beta Stocks  

Investing in high beta stocks in Nifty 50 can offer several benefits, including:

• Diversification: Nifty high beta stocks can help diversify a portfolio, as they often come from different industries and sectors than low or negative beta stocks. By investing in high beta stocks, investors can reduce the overall risk of your portfolio by spreading investments across different types of stocks.

• Exposure to Growth Industries: High beta shares are often found in growth industries such as IT, healthcare, and biotech. Investing in these industries can provide exposure to innovative companies that are expected to experience strong growth in the future.
• Potential for Capital Appreciation: High beta shares can offer potential for capital appreciation, as they have the potential to increase in value rapidly.

As always, investors are advised to do their own research or consult their financial advisors before investing in high beta stocks.

What are High Alpha and Low Beta Stocks?

High alpha low beta stocks India 2024 refer to stocks that exhibit high returns relative to their risk, as measured by their beta coefficient. These stocks are generally considered to be less volatile than the broader market, as their beta coefficient is below 1, as opposed to low beta high alpha stocks. However, they also offer higher returns than the market, as measured by their alpha coefficient.

Factors to Consider When Investing in High Beta Shares

Investing in high beta stocks in Nifty 50 can be a lucrative strategy. However, it’s important to consider several factors before investing in these Nifty 50 high beta value stocks. Here are five key factors to consider:

Industry Trends

One of the most important factors to consider before investing in high beta shares is industry trends. Investors should conduct thorough research to understand the current and future outlook for the company’s industry. Investing in high beta f&o stocks in an industry that is expected to multiply may provide better returns.

Company Performance

The performance of the company itself is also a critical factor to consider. Investors should evaluate the financial statements (such as balance sheets), revenue growth, profit margins, and other relevant metrics to determine whether the company is a good investment opportunity. Companies with strong fundamentals and positive earnings growth may be more attractive investment opportunities.

Market Conditions

Market conditions can have a significant impact on these stocks. Factors such as interest rates, inflation, and geopolitical events can affect the overall market, which in turn can impact the performance of these stocks. Therefore, it’s important to consider market conditions and how they may affect the performance of high beta shares before investing.

Risk Tolerance

Investing in high-beta stocks requires a higher risk tolerance than investing in low beta stocks. These stocks are more volatile and can experience significant price fluctuations in a short period. Therefore, investors should consider their risk tolerance before investing in these stocks.

Valuation

Finally, investors should consider the valuation of these stocks before investing. These best beta stocks may be overvalued or undervalued, and investors should evaluate the stock’s price-to-earnings beta ratio (P/E ratio), price-to-book ratio (P/B ratio), and other relevant metrics to determine whether the stock is a good investment opportunity.

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To Wrap It Up…

High beta stocks offer the potential for higher returns but come with higher risks. Therefore, investors should weigh their risk tolerance with their investment objectives to make a decision. You can also invest in high-beta stocks via modern instrument products like smallcase. It offers a platform to invest in a range of high-beta stocks in a diversified portfolio.

Frequently Asked Questions About High Beta Stocks