But surely names would not affect how companies fared on the real stock market? What sane investor would base investment decisions on names? Alter and Oppenheimer tracked ten stocks with easy-to-pronounce names and ten stocks with hard-to-pronounce names on the New York Stock Exchange. They found that companies with easy-to-pronounce names outperformed companies with hard to-pronounce names by 11.2 percent on their very first day of trading. After six months, the difference was more than 27 percent. After a year, it was more than 33 percent. If you'd put a million dollars into the stocks with easy names and a million dollars into the stocks with hard names, the group with easy names would have outperformed the group with difficult names by $330,000. (p. 29)
Thursday, January 10, 2013
FATS LIMBAUGH WAS CORRECT ABOUT THIS
He once said that the market was irrational and in The hidden brain : how our unconscious minds elect presidents, control markets, wage wars, and save our lives by Shankar Vedantam, there's some evidence to support Fats:
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