Investing Research Articles

...investors may be able to exploit a stock price effect by focusing on the associated abnormally positive return during the first calendar quarter.

...adjusting asset class allocations according to key economic indicators may help investors manage risk and/or boost long-term returns.

...even though S&P 500 index timing rules based on fundamental indicators and investor sentiment indicators might significantly beat a buy-and-hold benchmark when evaluated in isolation, this outperformance generally evaporates after correcting for data snooping bias....

...finance and economics professors on average currently estimate that investors require an annual excess return from equities in the range 5% to 7%.

Do individuals who use investment advisors achieve higher returns than those who do not? Two closely related papers entitled “Investment Advice and Individual Investor Portfolio Performance” of January 2009 by Marc Kramer and “The Impact...

...the way to survive the fat-tailedness of investment returns is through limiting exposure to such investments.

...evidence from this 19th century test supports belief in the persistence of the size effect and the value premium for equities.

As suggested by a reader, we evaluate here the intermediate-term S&P 500 index calls of Tim Ord via MarketWeb since 1/20/06. Tim Ord is is president, editor and publisher of The Ord Oracle, “devoted to...

...the portfolio returns of "Strategy Lab" participants since late 2001 vary widely, but aggregate results offer some support for the belief that experts on average can consistently outperform the broad stock market.

Is firm total asset growth rate an independently valuable indicator of future stock returns? In their January 2009 paper entitled “The Asset Growth Effect in Stock Returns”, Michael Cooper, Huseyin Gulen and Michael Schill review...

...stocks of companies with relatively high (low) cash-to-asset ratios tend to outperform (underperform).

...evidence from limited tests does not support a belief that the Mutual Fund Research Newsletter quarterly asset class allocation recommendations have any market timing value.

...large hedge funds contend with significant diseconomies of scale, and consequently underperform comparable small hedge funds.

...equity investors may want to alternate between momentum and value investing styles as the overall stock market varies from low-volatility to high-volatility states.

...the profitability of pairs trading relates strongly to differences between paired stocks regarding: (1) the speed with which news is likely to diffuse across the shareholder bases; and, (2) the frictions which probably inhibit acting...

...equity traders may find the trading rules in Short Term Trading Strategies That Work interesting, but they should consider potential limitations in the supporting analyses and recognize the challenge of reliably extracting economic value from...

...the current environment may challenge the lifetime experience of most investors regarding the relationship between the inflation rate and stock returns.

...medium-term momentum investing may be profitable in most, but not all, international equity markets.

...Profit from the Peak offers a range of stock recommendations to exploit a long-term energy shortage, but historical data suggest that a portfolio constructed from these stocks may be quite volatile with some big hits...

...non-financial firms with high levels of cash tend to use the cash for risky growth, earning higher average stock returns with higher beta. Trading frictions from rebalancing to capture the abnormal returns would tend to...

...options buyers (sellers) might want to tilt toward stocks with high (low) betas, large (small) market capitalizations, low (high) book-to-market ratios and significant (no) momentum.

...the professional investors at ValueInvestorsClub.com on average successfully identify and exploit value opportunities by focusing mostly on mismatches between stock price and intrinsic value.

...evidence from a few tests does not support a belief that trend reversals in the 10-day lagging average S&P 500 index put-call ratio predicts reversals in the level of the S&P 500 index.

...recent S&P 500 aggregate bottoms-up earnings growth estimates have often been highly variable and substantially inaccurate.

...investors should not expect the typical "expert" to outperform a simple extrapolation of the long-term trend in forecasting the level of a broad stock market index one year ahead.