Question: A young investor believes that he can beat the market
A young investor believes that he can beat the market by picking stocks that will increase in value. Assume that on average 50% of the stocks selected by a portfolio manager will increase over 12 months. Of the 25 stocks that the young investor bought over the last 12 months, 14 have increased. Can he claim that he is better at predicting increases than the typical portfolio manager?
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