The Myth Of The Earnings Yield

The Myth of the Earnings contribute The Myth of the Earnings make Essay written by Sam Vaknin Sam Vaknins Psychology, Philosophy, economic science and Foreign Affairs Web Sites A very unconvincing minority of firms distribute dividends. This truism has revolutionary implications. In the absence of dividends, the foundation of most - if not all - of the financial theories we operate in pitch to determine the value of sh atomic number 18s, is falsified.

These theories rely on a few implicit and explicit assumptions: (a) That the (fundamental) value of a share is closely correlated (or even equal to) its market (stock exchange or transaction) price (b) That price movements (and volatility) are in the main random, though correlated to the (fundamental) value of the share (will always cut with to that value in the long term) (c) That this fundamental value responds to and reflects new-fangled nurture efficiently (old information is wide of the marky incorporated in it) Investors are supposed to d...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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