pdf-tiedosto: trendspotting

Question 1

There is no way to predict whether the price of stocks and bonds will go up or down over the next few days or weeks. But it is quite possible to foresee the broad course of the prices of these assets over longer time periods, such as, the next three to five years. These findings, which may seem both surprising and contradictory, were made and analyzed by this year’s Laureates, Eugene Fama, Lars Peter Hansen and Robert Shiller

Answer 1

juu juu

Question 2

Predictability is absent in the short run… but there is predictability in the long run.

Answer 2

Aijjaha! :D

Question 3

Basic theory says that a stock’s value should equal the expected value of future dividends, so the price volatility that he observed appeared excessive.

Answer 3

Tämä on Dividend discount modes

Question 4

An implication of the excessive swings in stock prices is that

-> a high ratio of price relative to dividends in one year will tend to be followed by a fall in prices relative to dividends over subsequent years, and vice versa. This means that returns follow a predictable pattern in the longer run

Answer 4

Tämä on Price/Dividend ratio

Question 5

The fact that stock markets are very hard to predict in the short run, and that stock-picking is very difficult both in the short and the long run, has led to close examination of the performance by mutual funds.

Answer 5

Jyy jyy :)