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Profitability of investment strategies developed on the basis of buy and sell recommendations

Author

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  • Wnuczak Paweł

    (Department of Finance, Kozminski University, Warsaw, Poland)

Abstract

Aim/purpose – The paper has two objectives. The first is to examine the profitability of applying investment strategies based on “buy” and “sell” recommendations issued by stock market analysts. The second objective is to validate that analysts who issue a recommendation may not be impartial (not supporting any of the sides involved in an argument) because the largest group of recommendations issued is “buy” recommendations.

Suggested Citation

  • Wnuczak Paweł, 2021. "Profitability of investment strategies developed on the basis of buy and sell recommendations," Journal of Economics and Management, Sciendo, vol. 43(1), pages 317-338, May.
    • Handle: RePEc:vrs:jecman:v:43:y:2021:i:1:p:317-338:n:12
    DOI: 10.22367/jem.2021.43.15
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    References listed on IDEAS

    as
    1. Park, Sung Jun & Park, Ki Young, 2019. "Can investors profit from security analyst recommendations?: New evidence on the value of consensus recommendations," Finance Research Letters, Elsevier, vol. 30(C), pages 403-413.
    2. Jeffrey Hobbs & Terrill R. Keasler & Chris R. McNeil, 2012. "Short Selling Behavior and Mad Money," The Financial Review, Eastern Finance Association, vol. 47(1), pages 65-89, February.
    3. Ryan, Paul & Taffler, Richard J., 2006. "Do brokerage houses add value? The market impact of UK sell-side analyst recommendation changes," The British Accounting Review, Elsevier, vol. 38(4), pages 371-386.
    4. Chen Su & Hanxiong Zhang & Kenbata Bangassa & Nathan Lael Joseph, 2019. "On the investment value of sell-side analyst recommendation revisions in the UK," Review of Quantitative Finance and Accounting, Springer, vol. 53(1), pages 257-293, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    recommendations; stock exchange; investment;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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