I would hesitate to try to put a narrative-based explanation to it. As you pointed out, Beta is the correlation of a security's price history to the market's m

I would hesitate to try to put a narrative-based explanation to it. As you pointed out, Beta is the correlation of a security's price history to the market's movement. Approximately half of any group of equities will have a correlation below 1 against the group's weighted average performance. If the group is large enough, its movement will closely mirror the market, so for a large enough group of equities (chosen randomly) about half will have correlation below 1, and half above. It merely means that Microsoft is reasonably closely tied to the market's movement, though slightly below. You compared it against its sector, technology. The tech sector has a higher average beta than the utilites sector. That's just the nature of the sector. Where it gets interesting is something like FB at 3.29. That's really high. But its price history is also short, having IPOd so recently... perhaps over time it will stabilize at a lower number.