Chapter Objectives

Understand the potential for abnormal returns in special investment situations.
Explain how abnormal returns might occur in mergers, new public issues, exchange listings, stock repurchases, and other investment opportunities.
Explain the controversy related to the small-firm and low-P/E ratio effects on stock market returns.
Be familiar with the latest theories about the relationship of book value to superior stock market returns.
Explain timing effects such as the January effect or the weekend effect on stock market returns.
Discuss the problem of distinguishing between superior returns and incorrect measurement of returns.

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