Tuesdays are all about academic (and practitioner) literature at Abnormal Returns. You can check out last week’s edition including a look at the case for ditching investment consultants.
Quote of the Day
"Professional money managers, who have mountains of data at their fingertips, entire floors of analysts supplying them with financial models, and generous travel budgets allowing them to meet with company management teams, still get most of their stock picks wrong."
(Jack Shannon)
Quant
- Academic research can inform, but saying it 'proves' something stretches credulity. (morningstar.com)
- There are more problems in academic finance than just p-hacking. (mathinvestor.org)
- A round-up of recent research white papers including 'Long-Term Private Equity Performance: 2000 to 2023.' (bpsandpieces.com)
Active management
- Institutional investors do a better job buying stocks than selling them. (alphaarchitect.com)
- Why do active managers invest in anything other than their best ideas? (blogs.cfainstitute.org)
- Falling active management share isn't making it easier to outperform. (alphaarchitect.com)
- Chris Ailman, “Wall Street never ceases to amaze me when they create new products and tools.” (institutionalinvestor.com)
Research
- Larry Swedroe, "With any long-term risk premium, it’s highly unlikely investors can time entry and exits because it’s simply not possible to know when losses will occur." (wealthmanagement.com)
- Which factors drive high yield bond returns? (insights.finominal.com)
- What is the volatility risk premium? (caia.org)
- Why identifying increasing returns is so important. (morganstanley.com)
- Pre-IPO companies issue executives cheap options before pricing their shares. (papers.ssrn.com)
- More evidence of a beauty wage premium. (marketwatch.com)