Behavioral Preferences of Investors in Reaction to the Fundamental Variables Based on Sochastic Dominance

Document Type : Research Paper

Authors

1 shahid beheshti university

2 sheykhbahaeei university

Abstract

In this article, the fundamental signal analysis to evaluate the relative dominance of the winner-losser stocks based on investor’s preferences has been investigated.Therefore, based on factors related to the profitability , growth and variability the signals of information content of seven financial ratios are identified and based on winner-loser stock related to investr’s preferences identified. In this study, all the financial data of listed companies in TSE for the period 1380 to 1390 are used. The results indicated that the higher current and future return of winner stock related to losser stock one Period after portfolio formation. Also the further results indicate the second and third order of stochastic dominance of winner stocks relate to losser stocks and second and third order of stochastic dominance of losser stocks relate to winner stocks in the negative market conditions.

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References

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