Bubbles and Crashes in Experimental Asset Markets

reminiscences of a stock operator pdf

Bubbles and Crashes in Experimental Asset Markets

A Long standing of common stock valuation holds that a stock’s current market value tends to converge to the (risk adjusted) discounted present value of the rationally expected dividend stream. If markets are efficient, then in equilibrium, stock prices should change only when there is new information that changes investors’ dividend expectations.

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