Risk Factor
How much the stock moves with the market and how much it moves on its own.
Definition
The risk factor captures the volatility of a stock's returns — both how much it co-moves with the broader market (beta) and how much it moves day-to-day on its own (realized volatility).
Lower volatility is empirically associated with higher risk-adjusted returns. This is the "low-volatility anomaly" — the finding, against the predictions of CAPM, that low-volatility stocks have produced higher returns per unit of risk than high-volatility stocks. Frazzini and Pedersen's "Betting Against Beta" (2014) is one of the canonical papers.
Risk in a quant scoring context is usually backward-looking — a stock's beta and volatility are computed from the past 1–5 years of returns. That makes it a coarse proxy for future risk, especially through regime changes.
How QScoring uses it
QScoring's risk category uses two inputs: beta to the S&P 500 (closer to 1.0 scores higher) and 60-day annualized realized volatility (lower scores higher, z-scored within sector). Beta is reported by the data provider and computed against ~5 years of history. See the risk section for the regime-change weakness.