Talking Numbers: Technical versus Fundamental Investment Recommendations

43 Pages Posted: 22 Aug 2015 Last revised: 8 Jun 2018

See all articles by Doron Avramov

Doron Avramov

Interdisciplinary Center (IDC) Herzliyah

Guy Kaplanski

Bar-Ilan University - Graduate School of Business Administration

Haim Levy

Hebrew University of Jerusalem - Jerusalem School of Business Administration; Fordham University

Date Written: 2018

Abstract

Market efficiency is often evaluated through the ability of fundamental analysis or technical trading rules to exploit predictable patterns in asset prices. The evidence following decades of empirical research is mixed. This paper reexamines the evidence using a novel database from the TV show “Talking Numbers.” We assess the performance of 1,599 investment recommendations, where each recommendation features a fundamental and a technical forecast. We show that technicians are able to predict individual stock returns to economically significant degrees up to a one-year horizon. Beyond that, the null hypothesis of market efficiency is not rejected for market-wide indices, equity sectors, bonds, or commodities.

Keywords: fundamental analysis; technical rules; market efficiency; market anomalies

JEL Classification: G10, G14, G24

Suggested Citation

Avramov, Doron and Kaplanski, Guy and Levy, Haim, Talking Numbers: Technical versus Fundamental Investment Recommendations (2018). Journal of Banking and Finance, Volume 92, 2018, 100-114. Available at SSRN: https://ssrn.com/abstract=2648292 or http://dx.doi.org/10.2139/ssrn.2648292

Doron Avramov (Contact Author)

Interdisciplinary Center (IDC) Herzliyah ( email )

P.O. Box 167
Herzliya, 46150
Israel

Guy Kaplanski

Bar-Ilan University - Graduate School of Business Administration ( email )

Ramat Gan
Israel

Haim Levy

Hebrew University of Jerusalem - Jerusalem School of Business Administration ( email )

Mount Scopus
Jerusalem, 91905
Israel

HOME PAGE: http://pluto.huji.ac.il/~mshlevy/

Fordham University ( email )

140 West 62nd Street
New York, NY 10023
United States

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