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Record W2104024060

IS STOCK RETURN PREDICTABILITY SPURIOUS

2003· article· en· W2104024060 on OpenAlex

Why this work is in the frame

A frame that forgets how it found something cannot be audited. These are the routes that admitted this work.

affAt least one author lists a Canadian institution in the pinned OpenAlex snapshot.

Bibliographic record

VenueSSRN Electronic Journal · 2003
Typearticle
Languageen
FieldDecision Sciences
TopicStock Market Forecasting Methods
Canadian institutionsMcGill University
Fundersnot available
KeywordsSpurious relationshipPredictabilityEconometricsStock (firearms)Dividend yieldDividendRegressionRegression analysisVariable (mathematics)Stock marketComputer scienceEconomicsStatisticsMathematicsMachine learningFinanceEngineering
DOInot available

Abstract

fetched live from OpenAlex

Two problems, spurious regression bias and naive data mining, conspire to mislead analysts about predictive models for stock returns. This article demonstrates the two problems, how they interact, and makes suggestions for what to do about it. If expectations about a stock's return are dependent through time, then variables like dividend yields and yield spreads can appear to be better at predicting returns than they actually are. This is a potentially serious problem when implementing tacticalassetallocationstrategies, activelymanagingaportfolio, measuringinvestment performance, attempting to time the market, and in other situations where analysts use lagged variables to predict returns. We show that searching for predictor variables using historical data can increase the likelihood of finding a variable with spurious regression bias. Such a variable appears to have worked in the past, but will not work in the future. A simple transformation of the predictor variables can be used to reduce the risk of finding spurious predictive relations.

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

Full frame distilled prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.

metaresearch head score (Codex)0.052
metaresearch head score (Gemma)0.025
Version: codex-gemma-dda1882f352aValidation status: machine_predicted_unvalidated
Candidate categoriesMetaresearch, Research integrity, Insufficient payload (model declined to judge)
Consensus categoriesMetaresearch
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Theoretical or conceptual · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.889
Threshold uncertainty score1.000

Codex and Gemma teacher scores by category

CategoryCodexGemma
Metaresearch0.0520.025
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0000.001
Science and technology studies0.0010.000
Scholarly communication0.0000.000
Open science0.0010.000
Research integrity0.0000.003
Insufficient payload (model declined to judge)0.0010.000

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.069
GPT teacher head0.383
Teacher spread0.315 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it