Why higher risk doesn’t pay off in equity investing long-term
Margin Call: Analysts’ forecasts tend to be over-optimistic for companies with uncertain futures.
Nicholas Bagnall
Tue, 09 Mar 2021
Margin Call: Analysts’ forecasts tend to be over-optimistic for companies with uncertain futures.
One of the basic tenets of finance theory is that because investors prefer to reduce uncertainty about future investment returns, they will demand higher returns from riskier investments. From this starting point, finance theory predicts investors’ preference to reduce risk will affect the