The Return of High Beta?

JC Parets
September 24, 2021

High-beta stocks are hitting new multi-month highs relative to low volatility.

This is the opposite of what would be happening if the world was about to come to an end.

The ratio between High Beta stocks and Low Volatility stock basically stopped going up last February.

This makes perfect sense as so many other things stopped going up during that February-March period: Emerging Markets, Biotechnology, IPO Index, IBD 50 Index, Nasdaq new highs list, Nasdaq Advance-Decline line, Small-caps Index, Micro-caps Index and so many individual equities around the world.

So if High Beta can really get going here, what does that say about the rest of the market?

I like the Value Line Geometric Index, representing the Median stock price change, to be a solid gauge of the market.

These two are likely to break out simultaneously, if that's what they're going to do.

And I do think that's exactly what they're about to do.

My question is more about how long it's going to take.

Is it already starting?

Let us know what you think!

Our Premium Trade Ideas page has been updated so you can see exactly which stocks we want to be buying here.

JC

 

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