Consider the following statements A drop in the price-dividend ratio predicts a significantly higher excess return on the market over the next 5 years An increase in the yield-to-maturity spread between BAA and AAA rated bonds predicts a significantly higher excess return on the market over the next year I. II. II. The price-to-earning ratio is a better predictor for future market excess returns in short horizons than long horizons Gold-to-platinum is a better predictor for the next month market excess return than the variance risk premium IV. Which statements are correct?
Consider the following statements A drop in the price-dividend ratio predicts a significantly higher excess return on the market over the next 5 years An increase in the yield-to-maturity spread between BAA and AAA rated bonds predicts a significantly higher excess return on the market over the next year I. II. II. The price-to-earning ratio is a better predictor for future market excess returns in short horizons than long horizons Gold-to-platinum is a better predictor for the next month market excess return than the variance risk premium IV. Which statements are correct?
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 17P
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