How do you deal with beta instability over time (rolling vs. historical)?

Beta drifts — a firm with β = 1.2 five years ago can have β = 0.8 today (business-model change, growth in size). Methods:

• 5Y weekly (Bloomberg standard): robust against short-term noise.
• 2Y daily: reacts faster.
• Rolling 2Y beta chart: visualizes the beta drift.
• Structural breaks: if the firm made a large acquisition in 2020, take only the post-event period. If the rolling beta is unstable (range 0.7 to 1.4 over 5 years) — use an industry beta instead of the raw beta.