Investment B, part 2 question about pair trading

[itsyourz]

slide 74, it says

long overvalued , short undervalued

i dont get it, intuitively i think overvalued stock is expensive,

that is, it's over-priced isn't it?

am i misunderstanding??

cheers

suk

 

[David Harper CFA FRM]

Hi suk,

You are correct, it is an error. Please note addition to errata: http://forum.bionicturtle.com/viewthread/732/

Thank you for spotting this...David