Higher Risk, Higher Payoff: Ten Beta Stocks Above 2.5

Beta is one measurement of risk. Beta, also known as the beta coefficient, measures how the expected return of a stock is correlated to the performance of the stock market as a whole. A positive beta, such as a one or two, means that the stock usually tracks the market in general. A zero beta means that the stock price is not correlated with the stock market at all. And a negative beta means that the stock tracks the market inversely.

A beta of one means the stock tracks the market directly, e.g. 1% up in the market means 1% up for the stock. The higher the beta, the more riskier the stock, yet the greater the return potential. For example, if the stock market increases by 3%, a stock with a beta of two should increase by 6%; in other words, twice as much. So for day traders, high beta stocks may be the way to go.

The following stocks have betas above 2.5, P/E ratios less than 20, PEG ratios less than one, and market caps greater than $500 million:

• GrafTech International Ltd. (GTI) The stock has a beta of 3.1, a P/E of 5.3, and a PEG of 0.49.
• United States Steel Corporation (X) The stock has a beta of 2.8, a P/E of 4.2, and a PEG of 0.62.
• DryShips Inc. (DRYS) The stock has a beta of 2.8, a P/E of 1.1, and a PEG of 0.01.
• Arris Group, Inc. (ARRS) The stock has a beta of 2.7, a P/E of 12.6, and a PEG of 0.72.
• Joy Global Inc. (JOYG) The stock has a beta of 2.7, a P/E of 9.0, and a PEG of 0.43.
• Teck Cominco Limited (TCK) The stock has a beta of 2.7, a P/E of 4.6, and a PEG of 0.92.
• ON Semiconductor Corp. (ONNN) The stock has a beta of 2.6, a P/E of 8.6, and a PEG of 0.58.
• PMC-Sierra, Inc. (PMCS) The stock has a beta of 2.6, a P/E of 7.7, and a PEG of 0.54.
• Yanzhou Coal Mining Co. (YZC) The stock has a beta of 2.6, a P/E of 3.8, and a PEG of 0.76.
• NVIDIA Corporation (NVDA) The stock has a beta of 2.6, a P/E of 8.1, and a PEG of 0.56.

Another way to get a much higher return than what a sector or industry is doing, without buying on margin, is by using Ultra Long ETFs, a list of which can be found at WallStreetNewsNetwork.com.

Disclosure: Author does not own any of the above.