Question
According to Barberis et al. (1998), momentum profit is attributable to investors conservatism and representative biases. Specifically,... a. None of the statements about Barberis et
According to Barberis et al. (1998), momentum profit is attributable to investors conservatism and representative biases. Specifically,...
a.
None of the statements about Barberis et al. (1998) is true.
b.
upon repeated positive earnings surprises, investors representative bias dominates, making investors assume that the trend will not continue.
c.
investors initially overreact to good news, followed by underreacting to even more good news.
d.
upon the first positive earnings surprise, investors conservatism bias dominates, leading to their overreaction to the news and pushing the stock price downwards.
e.
All of the statements about Barberis et al. (1998) are true.
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