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Volume 29 Number 1 June 2004
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Returns to Australian Investment Newsletter Recommendations |
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Elizabeth Carson, Raymond da Silva Rosa and Richard Maynier
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Abstract |
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We investigate the recommendations made by four high profile Australian
investment newsletters during 2001. Five issues are investigated: (1) The clarity of
newsletter recommendations; (2) the return that might have been earned by
following newsletter recommendations; (3) the liquidity of shares recommended; (4)
the relative success of recommendations on small, medium and large stocks; and (5)
the extent newsletters make recommendations consistent with momentum and
contrarian investing strategies. We find that newsletters contain a varying mix of
clear and less clear recommendations. The clear recommendations we evaluated
earned exceptionally high return, relative to control samples matched on size and
holding period and relative to the ASX300 index. The exceptional performance was
driven by recommendations on stocks ranked outside the top 150, by market
capitalization, and was consistent with a momentum based selection strategy.
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Download this article.
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Keywords |
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INVESTMENT NEWSLETTERS; MARKET EFFICIENCY; SHARE RETURNS.
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Contact DetailsElizabeth CarsonFaculty of Economics & Commerce The University of New South Wales UNSW, Sydney, NSW 2052.
E-mail: e.carson@unsw.edu.au
Raymond da Silva Rosa and Richard Maynier
E-mail: ray.dasilvarosa@uwa.edu.au
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| The authors wish to thank Sheila Johnstone, Peter Luckett, Ken Martin and Garry Shanahan for their help in this research. |
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This page was last updated in July, 2004. Copyright © The Australian Graduate School of Management Phone: +61 2 9931 9200; Email: eajm@agsm.edu.au |