PureBytes Links
Trading Reference Links
|
In a message dated 98-08-21 11:31:52 EDT, you write:
<< Beta is a technical indicator of issue volatility. If the issue is about as
volatile as the market average, Beta = 1. If the issue is one and a half
times as volatile, Beta = 1.5, twice as volatile, Beta = 2, etc.. If the
issue is less volatile then the market, Beta is less than 1. An issue half
as volatile as the market average would have a Beta of .5.
>>
Richard,
My understanding of Beta is the same as yours is with an extension. Stocks
with betas below zero move in a direction opposite to the "market". For
example, a stock with a beta of -1 would move proportionally exactly as much
as the market in the opposite direction. A stock with a beta of -0.5 would
move half as much in the opposite direction. My research showed that only
about 6 percent of the stocks in my database had betas below zero which would
indicate they move in a direction opposing the "market".
I am not sure what index my database uses to represent the "market". The S&P
500 is frequently used, but, any index could be selected.
But then again, if I am so smart, what the heck am I doing in Pocatello Idaho.
Dan
P.S. Bob, sorry about that crack about there being nothing new in the market.
I edited it out, but, it appears I sent out a message with it anyway. It was
uncalled for and dragged down the level of discussion. Sorry.
|