Let me give an example with such a company. It's Michael Kors. The manufacturer of luxury goods has been experiencing serious difficulties lately, because of the challenges in the sector and its ongoing restructuring. The company has a negative beta of 0.45.It can not be ignored that the close levels at which the company shares are traded to their lowest values for the past one year. At levels of nearly $36, the company's shares are only about 3% of its annual bottom. Or, there is a very good level to place a close stop.
At the same time, slightly less bad quarterly results than expectations, which are, by the way, extremely negative, could trigger a serious increase in the shares of the luxury goods maker.
Still, we should not outwit the good growth of the Asian economies that the expansion of the company is focusing on. As a bonus, the company's price/earnings ratio is only 8.2 or nearly half that of the companies in the sector.
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