Which variable indicates how a security's price fluctuates with the overall market?

Beta is the variable that indicates how a security's price fluctuates in relation to the overall market. It measures the sensitivity of a stock’s returns to market returns, essentially reflecting the systematic risk associated with the security. A beta of 1 implies that the security's price tends to move with the market, meaning it has the same level of risk as the market. A beta greater than 1 indicates that the security is more volatile than the market, while a beta less than 1 signifies that it is less volatile.

This concept is critical for investors who want to understand how their investments may respond to market changes. By analyzing a stock’s beta, investors can make more informed decisions regarding the risk they are willing to take relative to the market's movements.