A beta coefficient is a numerical value that measures the sensitivity of an asset's returns to the returns of a benchmark, typically the market. In finance, it helps investors understand how much a stock or portfolio might move in relation to market changes. A beta of 1 indicates that the asset's price moves with the market, while a beta greater than 1 means it is more volatile, and a beta less than 1 indicates it is less volatile. Beta coefficients are commonly used in the context of the Capital Asset Pricing Model (CAPM), which helps determine the expected return on an investment based on its risk compared to the market. Investors often use beta to assess the risk associated with a particular stock or investment portfolio and to make informed decisions about their investments.