Graduation Year
2017
Date of Submission
12-2016
Document Type
Open Access Senior Thesis
Degree Name
Bachelor of Arts
Department
Economics
Reader 1
Eric Hughson
Terms of Use & License Information
Rights Information
© 2016 Nicholas J Lillie
Abstract
Using the Student Investment Fund at Claremont McKenna College as a proxy for inexperienced investors, I demonstrate that inexperienced investors using fundamental analysis produce momentum-like buying patterns. The results show that the Student Investment Fund is on average buying stocks that outperform Carhart’s four-factor asset pricing model in the year before purchase. As a result, the Student Investment Fund has, on average, underperformed the S&P500 by .48% per year since 1996. My thesis explores why the Student Investment Fund may have adopted momentum-like purchasing patterns and what steps can be taken to remedy it.
Recommended Citation
Lillie, Nicholas J., "Does Fundamental Analysis Lead to a Rudimentary Momentum Strategy for the Inexperienced Investor? Evidence from a Student Investment Fund" (2017). CMC Senior Theses. 1492.
https://scholarship.claremont.edu/cmc_theses/1492
