Moron Beta

To revisit the current discussion, after my digression, Beta tells you what the relationship WAS between a security and the market. It tells you nothing about what the relationship will be.
As suggested earlier, Beta can be any number you want as it is dependent on the time frame chosen. A one year Beta is one number, and a one week Beta is another for the same security.
Phormula Phreaks argue that if you use the same time frame for both the security and the market, the problem is solved. It isn't. And to make matters worse, frequently the number for Beta is tossed out like it's a constant, and with no reference to the time frame used to calculate the Beta. Beta is a variable, that means it changes. Variability is the mortal enemy of predictability.
In sum, knowing what happened, which is all Beta tells you for a given time frame in the past, is NOT the same as knowing why it happened. Historians and statisticians frequently equate the two. They do this by attributing one off events with causality.
For instance, as pointed out in Everything is Obvious (once you know the answer.) by Duncan Watts, if you notice that each time the wind blows, the leaves of a tree move, that's once kind of cause effect. It happens a lot, it has validity.
What historians frequently do is take a one time event, and attribute causality to subsequent events. That is, if a cat meows, and the leaves shake, the meow caused the subsequent movement in the leaves. It ain't so. His example is a skirmish between English and French ships in the 14th century leading to the hundred years war, as if the skirmish 'caused' the war. Nobody can know that, and certainly can't know it at the time of the sea battle. As it has been put, there is no, "Dear Diary, the hundred years war began today."