Forum Archive Index - July 2002
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[sharechat] Strategy for volatile times
This chart (hijacked from investorschronicle.co.uk) shows the performance of FTSE sectors over the past three months plotted against the sector's beta (its volatility over five years)
The chart shows a strong correlation between returns over the last three months and beta ...in a market that has tanked. Sectors with a low beta have performed far better than those with high beta.
If we assumed that this strong correlation applied to NZSE stocks and you were worried that the NZ market might tank as has happened worldwide maybe the best place for your money is in these low beta stocks - CPT POT LNN DBG MHI WKL SAN and UNL.
Conversely you would want to stay out of high beta stocks like FBU FFS CAH FOR THL ADV ITC BRY AIR and RBD
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