Definition of stock market anomalies
Analysis of Stock Market Anomalies worldwide
An anomaly is a term describing the incidence when the actual result under a given set of assumptions is different from the expected result. An anomaly provides evidence that a given assumption or model does not hold in practice. The model can either be a relatively new or older model.
Types of Stock Market Anomalies | Finance - Zacks
Anomalies often occur with respect to asset pricing models, in particular the capital asset pricing model CAPM. Although the CAPM was derived by using innovative assumptions and theories, it often does a poor job in predicting stock returns.
The numerous market anomalies that were observed after the formation of the CAPM helped form the basis for those wishing to disprove the model. Although the model may not hold up in empirical and practical tests, that is not to say that the model does not hold some utility.
Dictionary Term Of The Day. A measure of what it costs an investment company to operate a mutual fund.
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What is an 'Anomaly' An anomaly is a term describing the incidence when the actual result under a given set of assumptions is different from the expected result.
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