U.S. Narrow Markets: An Empirical Investigation

Chandrashekaran, Vinod
March 2000
Journal of Financial Planning;Mar2000, Vol. 13 Issue 3, p72
Academic Journal
This article looks into existence of a large number of underperforming stocks in contrast to the small number of outperforming stocks, a recent phenomenon in the U.S. securities market. Recent stock market performance in the U.S. has been characterized by many market observers as "narrow" in the sense that there have been relatively few outperforming stocks and a relatively large number of underperforming stocks. The article also raises a number of interesting issues for portfolio management such as the performance of concentrated versus diversified portfolios in narrow- markets, the re-appearance of the Standard & Poor's 500 Index effect and the possibility of creating a new asset class of global companies.


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