• Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint
Share this Page URL
Help

Chapter 9. Holy Grails > Wall Street: Analysis Paralysis

Wall Street: Analysis Paralysis

In 2000, there were 28,000 recommendations by brokerage-house analysts. At the start of October 2000, 99.1 percent of those recommendations on U.S. companies were either strong buy, buy, or hold. Just 0.9 percent of the time, analysts said sell. Listening to these analysts for guidance was the public’s conscious decision not to think for themselves.

A recent study at Dartmouth College by Kent Womack, observes that brokerage analysts often comment on and recommend companies that their firms have recently taken public. The research shows that stocks recommended by analysts perform more poorly than “buy” recommendations by unaffiliated brokers prior to, at the time of and subsequent to the recommendation date.


PREVIEW

                                                                          

Not a subscriber?

Start A Free Trial


  
  • Creative Edge
  • Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint