NEW YORK ( TheStreet) -- School stocks have had a volatile ride in the new millennium, driven mostly by technical momentum, not fundamentals.Today I am profiling seven school stocks. Three peaked in the April 2004 to June 2004 time frame, one in February 2009, and the other three in April 2010. These stocks have not traded in sync with the overall market volatility. One bottomed in October 2011, two in July 2012, another in November 2012, and the other three in 2013 between January and April. When stocks are this volatile, trading strategies must be based more heavily on the technicals than on the fundamentals. School stocks are in the consumer-discretionary sector which is 14.6% overvalued. The school industry is just 6% overvalued, and all of these stocks are rated hold according to ValuEngine.
A factor for these stocks is whether the Senate passes a bill that prevents the doubling of the interest rate on student loans. If rates hold steady, school stocks could have an upside trade due to improving technicals.