Pitfalls in market timing test

C-Tier
Journal: Economics Letters
Year: 2009
Volume: 103
Issue: 3
Pages: 123-126

Authors (3)

Chu, Chia-Shang (not in RePEc) Lu, Liping (not in RePEc) Shi, Zhentao (Georgia Institute of Technolog...)

Score contribution per author:

0.335 = (α=2.01 / 3 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Henriksson and Merton's market timing test suffers nontrivial size distortion when the observations are serially dependent sequences. Potential danger of finding spurious timing ability can be avoided by implementing a Markov regression that includes the lagged dependent variables as additional explanatory variables.

Technical Details

RePEc Handle
repec:eee:ecolet:v:103:y:2009:i:3:p:123-126
Journal Field
General
Author Count
3
Added to Database
2026-01-29