Stocks of Admired Companies and Spurned Ones

17 Pages Posted: 24 Jan 2010

See all articles by Meir Statman

Meir Statman

Santa Clara University - Department of Finance

Deniz Anginer

World Bank Research


Do stocks of admired companies yield admirable returns? Are increases in admiration followed by high stock returns? And how reliable is the relation between admiration and returns? These are the questions we answer in this paper. We study Fortune magazine’s annual list of “America’s Most Admired Companies” and find that stocks of admired companies had lower returns, on average, than stocks of spurned companies from April 1983 through December 2007. Moreover, we find that increases in admiration were followed, on average, by lower returns. We also find that the dispersion of returns is high, especially in the spurned portfolio. This implies that investors who want to benefit from the return advantage of spurned stocks must diversify widely among them.

Keywords: behavioral finance, investor behavior, efficient market theory, affect

JEL Classification: G00, G10

Suggested Citation

Statman, Meir and Anginer, Deniz, Stocks of Admired Companies and Spurned Ones. SCU Leavey School of Business Research Paper No. 10-02. Available at SSRN: or

Meir Statman (Contact Author)

Santa Clara University - Department of Finance ( email )

500 El Camino Real
Santa Clara, CA 95053
United States
408-554-4147 (Phone)
408-554-4029 (Fax)

Deniz Anginer

World Bank Research ( email )

1818 H Street, NW
Washington, DC 20433
United States

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