High-tech companies generally exhibit what type of beta?

High-tech companies typically exhibit a beta that is above one. Beta is a measure of a stock's volatility in relation to the overall market. A beta greater than one indicates that the stock tends to move more than the market; it is more volatile. High-tech firms are often seen as growth-oriented, with their stock prices being more sensitive to changes in market conditions. As a result, when the market moves, these stocks usually experience more significant fluctuations, leading to a beta greater than one. This higher beta reflects both the potential for higher returns and the higher risk associated with investing in rapidly evolving sectors, such as technology. The inherent uncertainty and innovation in tech industries contribute to a tendency for these companies to have a more pronounced reaction to market movements compared to industries that are more stable or less growth-oriented.