Investing Expertise

…for the sake of realism, investment strategy developers should rigorously examine the defensibility of any assumptions embedded in their inference processes.

A reader commented and asked: “I searched your site for ‘insider’ and found very little investigation of a relationship between insider buys and stock price movement. Is this an area you could look at, classify and present to readers?”

…evidence indicates that expert analysts who have relatively high prior earnings forecasting accuracies, forecast frequencies and forecast revision frequencies and who cover relatively few companies and industries make abnormally good stock recommendations.

The quality of working papers from academia is as high as, or higher than, that of many analyses available to investors from investment industry sources and from other investors.

…investors may want to consider how their cultural predispositions affect their processing of reported views of experts on financial markets.

…the information Barron’s makes publicly available about this service is inadequate to support any meaningful review (and, arguably, to make any decision about subscribing).

…the stocks of companies unadmired by the ostensibly well-informed may well outperform the stocks of the companies admired.

There is some research relevant to your question based on mutual/hedge fund and fund manager data. See…

…active traders may find value in Trading from Your Gut as a means to benchmark their trading thought processes against those of an experienced and introspective peer.

…relatively inexperienced investors should find Fire Your Stock Analyst! a useful guide for analyzing U.S. stocks. However, the book presents no benchmarks for investing performance and does not support diversification across asset classes.

…evidence provides weak support for a belief that managers of U.S. bond mutual funds can on average time the bond market, but fund costs/fees offset any associated net outperformance of reasonable benchmarks.

…while there is a possibility that high values of the “Anxious Index” from the Survey of Professional Forecasters indicate stock market weakness the next quarter, this indicator does not convincingly relate to future U.S. stock market behavior.

Independent collection and analysis of this data is not presently practical for CXOadvisory.com.

…as illustrated using AAII’s StockScreens performance data, investors should consider especially the impact of portfolio turnover (trading frictions) and performance under different market conditions when evaluating stock screens.

…aggregate data on the performance of the stock trading systems currently offered on Collective2 is not encouraging for traders.