Investing Research Articles

A reader suggested Condor Options as a guru for review. To conduct a review, we evaluate the Condor Options Newsletter Performance table of iron condor trades (with a few hedging trades) available via the Condor Options Performance self-assessment. This table includes entry and exit dates, trade duration, specific positions/strike prices, initial value (credit), total amount… Keep Reading

Do stocks around the world tend to perform better around the time of annual earnings announcements by respective firms than during the rest of the year? In the June 2011 draft of their paper entitled “The Earnings Announcement Premium Around the Globe”, Brad Barber, Emmanuel De George, Reuven Lehavy and Brett Trueman investigate whether the… Keep Reading

Does the claim that “credit anticipates and equity confirms” support a trading strategy? In his June 2011 paper entitled “Credit-Informed Tactical Asset Allocation”, David Klein tests a stocks-cash allocation strategy that derives signals from relative valuation of the Bank of America/Merrill Lynch High Yield B index (converted to a default probability) and the Russell 2000… Keep Reading

Howard Marks introduces his 2011 book, The Most Important Thing: Uncommon Sense for the Thoughtful Investor, by stating: “…I have built this book around the idea of the most important things–each is a brick in what I hope will be a solid wall, and none is dispensable. …I consider it my creed, and in the… Keep Reading

As suggested by a reader, we evaluate here Gary Savage’s outlooks for the U.S. stock market since May 2007 as extracted from his current Smart Money Tracker blog (since March 2010) and its predecessor site. While Gary Savage states that his “main goal…for the next few years will be to keep investors focused on riding… Keep Reading

“The Fourth Quadrant: No Realm for the Normal” summarizes Nassim Taleb’s description of the realm of the Black Swan, concluding that in this realm “normal” statistical metrics and associated risk management methods do not work and that redundancy, not optimization, is key to risk management. This Fourth Quadrant encompasses return distributions that have infrequent, large,… Keep Reading

Do equity markets respond predictably to the probability and fact of war? In their May 2011 paper entitled “The War Puzzle: Contradictory Effects of International Conflicts on Stock Markets”, Amelie Brune, Thorsten Hens, Marc Rieger and Mei Wang relate U.S. stock market returns to the estimated likelihood of war involving the U.S. as evidenced by… Keep Reading

Can speculators in agricultural commodity futures earn a reliable premium from those seeking to hedge agricultural industry risk? In other words, can traders systematically exploit a persistent backwardation of agricultural commodity futures contracts? In the May 2011 version of their paper entitled “Returns to Traders and Existences of a Risk Premium of a Risk Premium… Keep Reading

Do gems offer good returns? How do the returns of these tangible assets compare with those of other asset classes? In the April 2011 version of their paper entitled “Hard Assets: The Returns on Rare Diamonds and Gems”, Luc Renneboog and Christophe Spaenjers examine recent returns on precious gems in U.S. dollars. They concentrate on… Keep Reading

How do the daily price statistics of commodities differ, and how do they compare with those for equities? In their May 2011 paper entitled “The Dynamics of Commodity Prices”, Chris Brooks and Marcel Prokopczuk examine the daily price statistics for six major commodity markets (crude oil, gasoline, gold, silver, soybeans and wheat) individually and relative… Keep Reading