Understanding the Stock Exchange: A Beginner's Guide

[juvenal]

These issues are still being carefully scrutinized by academicians.

This is a very good article by John Cochrane, author of a graduate financial economics textbook called Asset Pricing. It's pretty good at covering some fairly recent academic studies.

http://gsbwww.uchicago.edu/fac/john.cochrane/research/Papers/ep3Q99_3.pdf

Also, books by academicians like Andrew Lo of MIT (Non-Random Walk Down Wall Street, and Econometrics of Financial Markets) are worth checking out. The first is probably better suited for a layperson.

 

[steven187]

hello there

well i have a few questions to ask, so any advise would be helpful thank you
now the thing that i don't understand is that i have looked at brokerage reports on the same company, but from different investment banks, and they all seem to have different estimates, now obviously only one of them is going to be the closest to the future price, so how could it be reliable, I mean could some of these reports be biased? like if an investment bank has invested money into a company, wouldn't it also advise its investors to also invest into that same company? or is there some kind of law to stop them from doing things like that, and if there is how could anybody find out that the investment bank is doing such a thing.

also if all these reports give different prices wouldn't an investor be better of if he made guesses and go witht he gamble?

also these reports wouldn't they need to be updated everyday especially since different things happen in this world, that would be very time consuming especially considering that there are millions of companies listed in the world.

is the stock price suppose to converge to these estimated prices on these reports if so in what period?

lastly if we had unlimited human resourse, and access to all the public information, would it be possible to predict the companies future price over the next year or so and actually come very close to the actual movements in the stock price? from my understanding the best accurate estimate anybody can make would be tomorows, but how about in a year time?

thank you

steven

 

[steven187]

These issues are still being carefully scrutinized by academicians.

This is a very good article by John Cochrane, author of a graduate financial economics textbook called Asset Pricing. It's pretty good at covering some fairly recent academic studies.

http://gsbwww.uchicago.edu/fac/john.cochrane/research/Papers/ep3Q99_3.pdf

Also, books by academicians like Andrew Lo of MIT (Non-Random Walk Down Wall Street, and Econometrics of Financial Markets) are worth checking out. The first is probably better suited for a layperson.

hello there

by the way what is a layperson? and thanxs these links look pretty interesting

steven

 

[hitssquad]

what is a layperson?

A non-expert, as in "clergy and laity."