Stock selection and weighting schemes can be viewed as complimentary tools for accomplishing investment goals. Most smart beta indices are based on ad hoc choices of these two features made by an index provider. Investors can benefit from learning how to evaluate risk factors and disentangle the...

Expenditures on creation of intangible capital have increased but accounting standards have not kept pace. We investigate whether this has affected the value relevance of book value and earnings. We construct a composite measure of intangible intensity based on intangible assets capitalized on...

In this paper, we argue that the observed optimism in analysts' forecasts of earnings is related to the costs and benefits to analysts of issuing optimistic forecasts — when the costs of issuing an optimistic forecast are high relative to the benefits of doing so, optimism will be less...

This study shows that financial analysts of brokerage firms that provide investment banking services to a company (investment banker analysts) are optimistic, relative to other (noninvestment banker) analysts, in their earnings forecasts and investment recommendations. Returns earned by...

In this paper, we investigate the dysfunctional incentives of security analysts and how they affect analysts’ earnings forecasts and investment recommendations. We argue that these incentives motivate analysts to issue overly optimistic earnings forecasts and investment recommendations and...