Investing Research Articles

…there is considerable redundancy and invalidity among the many factors used to explain differences in returns among individual stocks. Three factors may be necessary and sufficient, with liquidity the most influential.

…investors systematically overvalue (undervalue) stocks when they expect earnings per share to be low (high). Their expectations exhibit conservatism bias with respect to both the downside and upside extremes.

…status may be more powerful than wealth as a motivator, with significant implications for investor/trader behavior.

…earnings acceleration helps explain stock returns, most notably when it amplifies the direction of earnings growth (both positive or both negative).

…there is a tendency for stocks worldwide to reprise their monthly return behavior every 12 months, with intracycle reversals, over periods of many years. Results suggest calendar-connected market structures.

…a small-stock buy-and-hold approach benefits fully from upside volatility (beta) but does not suffer the entire penalty of downside volatility.

Are stock market forecasters prone to hyperbole? Is there logic to predicting plunges and melt-ups at probabilities unjustified by rigorous empirical analysis? In their February 2007 paper entitled “Probability Elicitation, Scoring Rules, and Competition among Forecasters”, Kenneth Lichtendahl, Jr. and Robert Winkler apply game theory to model the behavior of forecasters who pit themselves not… Keep Reading

…Benjamin Graham-style value investing still works but is more difficult to execute than in the past because severe undervaluation has become rarer.

…it appears that some short selling is manipulative, seeking to scare other traders out of their holdings during sharp but temporary engineered price drops.

…there is an “information risk premium” such that stocks not covered by the news media yield significantly higher future returns than stocks heavily covered, even after accounting for other widely used risk factors.