Market Timing for the Individual Investor

Rich, Steven P.

doi:10.1016/1057-0810(93)90004-a

Cited by 5 publications

(1 citation statement)

References 9 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Long-horizon financial models are popular and have been used in prior studies. For example, Rich and Reichenstein (1993) use a type of long-horizon model to see if individual investors can time the stock market.…”

Section: Empirical Modelsmentioning

confidence: 99%

Downside risk

Johnson,

Naka

2014

FSR

View full text Add to dashboard Cite

This article examines the ability of consumer sentiment for different age groups to forecast short-term as well as long-term equity returns. Using a long-horizon asymmetric response regression format, we show that negative changes in sentiment have a greater influence on stock returns than positive changes in sentiment. Our findings are supportive of the prospect theory. However, we observe that younger individuals appear to be less risk-averse than older individuals. We provide evidence that reminds individual investors and financial planners that risk is an important consider- ation when investing, and that demographic characteristics matter when determining appropriate investing approaches and risk tolerance.

show abstract

Section: Empirical Modelsmentioning

confidence: 99%

Downside risk

Johnson,

Naka

2014

FSR

View full text Add to dashboard Cite

show abstract

Market timing using strategists’ and analysts’ forecasts of S&P 500 earnings per share

Chung

Kryzanowski

2000

FSR

View full text Add to dashboard Cite

This paper examines the bias in and usefulness of top-down and bottom-up consensus forecasts of earnings per share for the S&P 500 Index provided by market strategists and analysts to I/B/E/S. These forecasts exhibit a significant optimism bias that decreases over the 12 months up to release of actual earnings per share. The bias is significantly more pronounced for the bottom-up forecasts of analysts. Unlike the findings for country timing, we demonstrate that a stock market timer using switching rules based on the consensus forecasts of S&P 500 earnings or the directional switch in the consensus or in the number of switchers cannot generate a free lunch. © 2000 Elsevier Science Inc. All rights reserved.

show abstract

Stock selection based on Morningstar’s ten-year, five-star general equity mutual funds

Loviscek

Jordan

2000

FSR

View full text Add to dashboard Cite

Recent research suggests that the individual investor can build stock portfolios that outperform broad market indices. Based on this research and on evidence supporting the persistence of mutual fund performance, we test whether or not the individual investor can build market-superior portfolios from stocks selected from the top holdings of Morningstar’s ten-year, five-star general equity mutual funds. We use modern portfolio theory to construct the portfolios. Although the portfolios tend to outperform the S&P 500 for the 1990s, we conclude that the evidence is not strong enough to recommend this stock selection strategy to the individual investor. © 2000 Elsevier Science Inc. All rights reserved.

show abstract

Market Timing for the Individual Investor

Cited by 5 publications

References 9 publications

Downside risk

Downside risk

Market timing using strategists’ and analysts’ forecasts of S&P 500 earnings per share

Stock selection based on Morningstar’s ten-year, five-star general equity mutual funds

Contact Info

Product

Resources

About