Beta is a measure of a stock's volatility in relation to the overall market. It is a key component in the Capital Asset Pricing Model (CAPM), which investors use to determine the expected return on investment of an asset. A beta of 1 indicates that the stock's price will move with the market, a beta of less than 1 means that the stock is less volatile than the market, and a beta of greater than 1 indicates more volatility.