GM is outperforming F since car sales were reported last Friday. F should be trading over $15 by now with better sales figures. Both stocks are good long term buys here but can someone explain why F is lagging the market?
stocks can't all go straight up. that would be too easy. just relax. Ford is taking off eventually. If all of them went up everyday, we'd all be living out in Malibu watching the sun set in the Pacific.
Kao has been arbitraging the two for years, but with a preference for being long GM and short F. The arbitrage part keeps both at ultra low P/Es and forces F down when GM rises. The preference part keeps a positive alpha going for GM if you do a scatterchart/correlation chart of the two. I wrote more about it last night and earlier gave links to Kao's stuff at the SEC. I'll reply to that thread next so it pops to the top. Check my View Messages for the post after this one.