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Good News for Value Stocks : Further Evidence on Market Efficiency

Porta, Rafael La - 1995

This paper examines the hypothesis that the superior return to so-called value stocks is the result of expectational errors made by investors. We study stock price reactions around earnings announcements for value and glamour stocks over a 5 year period after portfolio formation. The...

Persistent link: https://www.econbiz.de/10012473559

Do Institutional Investors Destabilize Stock Prices? Evidence on Herding and Feedback Trading

Lakonishok, Josef - 1991

evaluate the potential effect of their trading on stock prices. We address two aspects of trading by money managers: herding …, which refers to buying (selling) the same stocks as other managers buy (sell) at the same time; and positive … of substantial herding or positive-feedback trading by pension fund managers, except in small stocks. Also, there is no …

Persistent link: https://www.econbiz.de/10012475147

Diagnostic Expectations and Stock Returns

Bordalo, Pedro - 2017

We revisit La Porta's (1996) finding that returns on stocks with the most optimistic analyst long term earnings growth forecasts are substantially lower than those for stocks with the most pessimistic forecasts. We document that this finding still holds, and present several further facts about...

Persistent link: https://www.econbiz.de/10012453848

Finance and the Preservation of Wealth

Gennaioli, Nicola - 2013

We introduce the model of asset management developed in Gennaioli, Shleifer, and Vishny (2012) into a Solow-style neoclassical growth model with diminishing returns to capital. Savers rely on trusted intermediaries to manage their wealth (claims on capital stock), who can charge fees above costs...

Persistent link: https://www.econbiz.de/10012459544

Salience and Asset Prices

Bordalo, Pedro - 2013

We present a simple model of asset pricing in which payoff salience drives investors' demand for risky assets. The key implication is that extreme payoffs receive disproportionate weight in the market valuation of assets. The model accounts for several puzzles in finance in an intuitive way,...

Persistent link: https://www.econbiz.de/10012459953

Expectations of Returns and Expected Returns

Greenwood, Robin - 2013

We analyze time-series of investor expectations of future stock market returns from six data sources between 1963 and 2011. The six measures of expectations are highly positively correlated with each other, as well as with past stock returns and with the level of the stock market. However,...

Persistent link: https://www.econbiz.de/10012459979

Do Managerial Objectives Drive Bad Acquisitions?

Morck, Randall - 1989

, when it buys a rapidly growing target , and when the performance of its managers has been poor before the acquisition …

Persistent link: https://www.econbiz.de/10012476048