Mean reversion refers to the tendency for

Question content area bottom

Part $1$

A$.$

the

longminus$$run

mean return on stocks to equal the

longminus$$run

mean return on bonds.

B$.$

futures prices to revert to the prices of the underlying securities$.$

C$.$

financial analysts whose stock picks have earned

aboveminus$$normal

returns in the past to be unable to pick stocks that will perform as well in the future.

D$.$

stocks with high returns today to experience low returns in the future and for stocks with low returns today to experience high returns in the future.