gdog

Comeback Stocks

I don't think that's quite correct. If you actually look at some reported beta values for the stocks above, the range is stark. Wachovia, a banking stock, is negative, CBS and KBH is moderate at 1.3, 1.17 respectively and CIT, is nearly 2.

So CIT makes sense, and KBH is heavily tied to home markets, and CBS is under a lot of pressure recently. The point being that Wachovia, CBS, and KBH are clear examples where historical betas are not a good guide in current conditions. There is significant disagreement in the valuations of all three companies, and CBS in particular was recently grossly undervalued.

This is also probably one way the SEC monitors for insider trading.


On Dec 04 10:45 PM joeactuary wrote:

> So essentially you sorted stocks by their Beta. No surprise that
> the large Beta stocks (decile 10) declined the most when the overall
> market declined and improved the most when the overall market went
> up.