Economics, Econometrics and Finance
4 years ago

Stock prices show mean reversion, impacting investment strategies worldwide.

SSRN Electronic Journal
Mean Reversion in Stock Prices: New Evidence from Panel Unit Root Tests
Paresh Kumar Narayan, Seema Narayan

Paper Summary

The article explores whether stock prices tend to revert to their average values over time. Previous studies have not reached a consensus on this matter. The researchers aim to re-evaluate whether stock prices exhibit mean reversion or follow a random walk pattern.

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