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Posted on Jul 21, 2024

The price of a share has a positive and statistically significant alpha with respect to a model (suck as CAPM). You would Buy the share

The price of a share has a positive and statistically significant alpha with respect to a model (suck as CAPM). You would

Buy the share because it is underpriced

Buy the share because it is overpriced.

Sell the share because it is underpriced.

Sell the share because it is overpriced.

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