Return to search

Does Fundamental Analysis Lead to a Rudimentary Momentum Strategy for the Inexperienced Investor? Evidence from a Student Investment Fund

Using the Student Investment Fund at Claremont McKenna College as a proxy for inexperienced investors, I demonstrate that inexperienced investors using fundamental analysis produce momentum-like buying patterns. The results show that the Student Investment Fund is on average buying stocks that outperform Carhart’s four-factor asset pricing model in the year before purchase. As a result, the Student Investment Fund has, on average, underperformed the S&P500 by .48% per year since 1996. My thesis explores why the Student Investment Fund may have adopted momentum-like purchasing patterns and what steps can be taken to remedy it.

Identiferoai:union.ndltd.org:CLAREMONT/oai:scholarship.claremont.edu:cmc_theses-2548
Date01 January 2017
CreatorsLillie, Nicholas J
PublisherScholarship @ Claremont
Source SetsClaremont Colleges
Detected LanguageEnglish
Typetext
Formatapplication/pdf
SourceCMC Senior Theses
Rights© 2016 Nicholas J Lillie, default

Page generated in 0.0015 seconds