4,129 research outputs found
Information Misweighting and Stock Recommendations
I provide evidence that analysts whose earnings forecast revisions showed signs of greater exaggeration in the past make recommendation changes that lead to lower abnormal returns than their peers. Interpreting stock recommendations as a forecast of future abnormal returns, I show that this evidence is consistent with the hypothesis that analysts who typically exaggerate or overstate the weight of their private information when issuing forecasts also do so when making recommendations. I also show that past earnings forecast provide incremental information about analysts' recommending behavior beyond that contained in past recommendations.Information misweighting; stock recommendations; earnings forecasts; financial analysts
Rotating elastic string loops in flat and black hole spacetimes: stability, cosmic censorship and the Penrose process
We rederive the equations of motion for relativistic strings, that is,
one-dimensional elastic bodies whose internal energy depends only on their
stretching, and use them to study circular string loops rotating in the
equatorial plane of flat and black hole spacetimes. We start by obtaining the
conditions for equilibrium, and find that: (i) if the string's longitudinal
speed of sound does not exceed the speed of light then its radius when rotating
in Minkowski's spacetime is always larger than its radius when at rest; (ii) in
Minkowski's spacetime, equilibria are linearly stable for rotation speeds below
a certain threshold, higher than the string's longitudinal speed of sound, and
linearly unstable for some rotation speeds above it; (iii) equilibria are
always linearly unstable in Schwarzschild's spacetime. Moreover, we study
interactions of a rotating string loop with a Kerr black hole, namely in the
context of the weak cosmic censorship conjecture and the Penrose process. We
find that: (i) elastic string loops that satisfy the null energy condition
cannot overspin extremal black holes; (ii) elastic string loops that satisfy
the dominant energy condition cannot increase the maximum efficiency of the
usual particle Penrose process; (iii) if the dominant energy condition (but not
the weak energy condition) is violated then the efficiency can be increased.
This last result hints at the interesting possibility that the dominant energy
condition may underlie the well known upper bounds for the efficiencies of
energy extraction processes (including, for example, superradiance).Comment: 32 pages, 6 figures; v2: minor improvements; v3: small changes,
matches final published version; v4: typos in the references fixe
Forecasting Bonds Yields in the Brazilian Fixed Income Market
This paper studies the predictive ability of a variety of models in forecasting the yield curve for the Brazilian fixed income market. We compare affine term structure models with a variation of the Nelson-Siegel exponential framework developed by Diebold and Li (2006). Empirical results suggest that forecasts made with the latter methodology are superior and appear accurate at long horizons when compared to different benchmark forecasts. These results are important for policy makers, portfolio and risk managers. Further research could study the predictive ability of such models in other emerging markets.
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