Explain in your own words what “post announcement drift” is. Why is this an anomaly for securities market efficiency? Give two behavioural biases that could generate post announcement drift.
Answer to relevant QuestionsExplain in your own words why the market response to accruals, as documented by Sloan (1996), is an anomaly for securities market efficiency.Define two limits to arbitrage, and explain why these might explain the lengthy existence of efficient securities market anomalies such as post- announcement drift and the accruals anomaly.Refer to Theory in Practice vignette 1.2. New Century’s accounting policies were severely questioned following the 2007– 2008 market meltdowns. KPMG was drawn into the lawsuits that followed New Century’s filing for ...Barclays Capital is a division of Barclays Bank, a U. K.– based multinational financial institution. On September 16, 2009, Barclays Capital announced a deal to sell US$ 12.3 billion of “ toxic” ABSs and other ...As described in Section 1.3, the FASB introduced FIN 46 in 2003, expanding the requirements for consolidation of variable interest entities (VIEs) and requiring additional supplementary disclosure by firms with interests in ...
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