Investing Research Articles

…speculators may be able to exploit the volatility risk premium by selling short-term deep out-of-the-money put options and all maturities of deep out-of-the-money call options on the broad stock market, especially during periods of high volatility.

…investors may be able to exploit the predictive power of the inflation rate and the yield curve to “switch out” of bear markets and thereby beat a buy-and-hold approach.

…short sellers have acted as specialized monitors who tend to know what they are doing, but high levels of and large positive changes in institutional ownership can obscure short interest informativeness.

…dramatic growth in the number of actively managed mutual funds has driven the proportion of truly skilled funds down, without commensurate reduction in average fund fees and expenses.

…this evidence does not support a belief that technical trading rules reliably generate out-of-sample outperformance after accounting for trading frictions.

…limited tests indicate that a strategy based solely on historical price data that seeks to exploit (avoid) periods of likely above-normal (below-normal) price growth has some merit. However, evidence does not support a belief that such a strategy can reliably outperform a buy-and-hold approach over long periods.

…evidence from simple tests indicates that combining RSI and MACD signals probably does not enhance, but instead may degrade, returns from trading a broad market index.

…a broad index trading strategy based solely on MACD crossovers probably has difficulty keeping up with buy-and-hold over long periods, but MACD crossover signals might be useful within more complex strategies.

…a broad index trading strategy based solely on RSI oversold/overbought signals probably underperforms buy-and-hold over long periods, but RSI signals might be useful within more complex strategies.

…evidence from simple tests does not support a belief that the Between the Hedges net portfolio position anticipates the short-term trend of the broad U.S. stock market.