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Technology Stocks : Random Musings of a Virgin Trader (was Dell Diary) -- Ignore unavailable to you. Want to Upgrade?

To: powershred who wrote (18)	2/18/1999 2:18:00 PM
From: alain deb	Read Replies (1) \| Respond to of 210

That's why it's important to have a standard price which reflects a standard risk premium which is equal to beta*average risk premium. For example:Dow risk premium=4%,Nasdaq=6%,IT=6.6% and for Dell standard beta=.85 & standard risk premium=5.6% When market is euphoric average risk premium falls along with individual stocks risks and vice versa when market is doomed. Yes market moods are impossible to time but once they occur their impact on the stock price can be measured vs. a normal/standard price. The mood for a specific stock can also vary forcing the beta to depart from it's standard value.Again the variance can be measured vs. a normal/standard price. Hopefully!????? regards,alain