Draw a link between market bubbles and overreaction

Assignment Help Financial Econometrics
Reference no: EM13813140 , Length:

Topic: overreaction and market bubbles

Research objective: to draw a link between market bubbles and overreaction

Methodology: quantitative (needs to have proper calculations shown with statistical analysis)

Word count: 3000 words

Preferably take 20 stocks during the dot com bubble from nasdaq and calculate abnormal returns hence proving/not proving overreaction.
Then calculate the abnormal returns of 20 stocks during the Japanese dot.com bubble and understand whether it signifies overreaction or not. And compare both results.

Daily stock prices need to be taken of one year prior to the peak and one year after the peak.

Verified Expert

Reference no: EM13813140

Questions Cloud

Assignment on cultural autobiography : Cultural Autobiography
Summary of supply chain management plan : Write a one-paragraph introduction summary of your supply chain management plan.
Demonstrate ascii code conversion : To demonstrate the use of subroutines, e.g. initialize the peripheral registers and to set the time delays, etc. To demonstrate ASCII code conversion. To demonstrate the use of indexed addressing to retrieve data from a table in memory.
Find the values assuming a regular or ordinary annuity : 1. Find the following values assuming a regular, or ordinary, annuity: a. The present value of $400 per year for ten years at 10 percent b. The future value of $400 per year for ten years at 10 percent c. The present value of $200 per year for five y..
Draw a link between market bubbles and overreaction : Draw a link between market bubbles and overreaction - Methodology: quantitative (needs to have proper calculations shown with statistical analysis)
What are the advantages and disadvantages of the eu : What are the advantages and disadvantages of the EU
What is the value of cash flow stream at the end of year 5 : Consider an uneven cash flow stream: Year Cash Flow 0. $2,000 1.  2,000 2. 0 3. 1,500 4. 2,500 5. 4,000 a. What is the present (Year 0) value of the cash flow stream if the opportunity cost rate is 10 percent? b. What is the value of the cash flow st..
Why six-sigma efforts do not apply to software : Explain the Six-Sigma quality constraints and provide a justification as to why the software development company should consider it
Write a brief business description of the company : Write a brief business description of the company and list some of the major businesses or markets that are overseas.

Reviews

Write a Review

Financial Econometrics Questions & Answers

  What is the discounted payback period for the cash flows

An investment project has annual cash inflows of $4,900, $3,400, $4,600, and $3,800, and a discount rate of 13 percent. a) What is the discounted payback period for these cash flows if the initial cost is $5,200

  What is present value of building new plant with technology

Your company has discovered a new process that lowers the operating cost per gallon to $1.50. Assuming that the competition will never catch up and the market demand is sufficiently high

  What will be the amount of your monthly mortgage payment

The house you want to buy costs $275 thousand. You plan to make a cash down payment of 10 percent, and borrow the rest in a 30 year mortgage at 4.68 percent APR. What will be the amount of your monthly mortgage payment

  Find what is the companys new required rate of return

Then an increase in investor risk aversion caused the market risk premium to rise by 2%. The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return

  Calculate hillarys npv with the abandonment option

You are planning to produce a new action figure called "Hillary". However, you are very uncertain about the demand for the product. If it is a hit, you will have net cash flows of $50 million per year for three years

  What is itss degree of financial leverage at an ebit level

Illinois Tool Company (ITC) fixed operating costs are $1,260,000 and its variable cost ratio (i.e. variable costs as a fraction of sales) is 0.70. The firm has $3,000,000 in bonds outstanding at an interest rate of 8 percent.

  How much will jack have to invest today in an account

Jack Robbins is saving for a new car. He needs to have $ 21,000 for the car in three years. How much will he have to invest today in an account paying 8 percent annually to achieve his target

  What is the present value of the same annuity due

If the present value of an ordinary, 20 year annuity is $5,000 and interest rates are 4%, what is the present value of the same annuity due

  How many shares of millers stock must sell to offset

Miller's has decided to add leverage to its financial operations by issuing $250,000 of debt at 8 percent interest. The debt will be used to repurchase shares of stock. You own 400 shares of Miller's stock.

  Determine what is the firms earnings growth rate

The newspaper reported last week that Bennington Enterprises earned $34 million this year. The report also stated that the firm's return on equity is 16 percent. Bennington retains 80 percent of its earnings.

  Calculate the price of a 8percent 1000dollar coupon bond

Calculate the price of a 8%, $1,000 coupon bond with 15 years left to maturity and a market interest rate of 5%. (Assume interest payments are semiannual.) Is this a discount or premium bond

  Determine the effect on net income and earnings per share

Determine the effect on net income and earnings per share for issuing stock and issuing bonds. Assume the new shares or new bonds will be outstanding for the entire year.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd