Showing papers on "Market capitalization published in 1976"

The Predictive Power of Stock Market Indicators

Abstract: Empirical research has cast so much doubt on chart readers that most capital theorists have about as much faith in charts as astronomers have in astrology. Certainly there is overwhelming evidence that attempting to predict future price changes on the basis of past price behavior is unproductive. There is, however, another aspect of technical analysis which has received much less attention from academicians. In its narrow form technical analysis seeks to forecast the direction of price movements of individual securities from past price and volume data. A second and somewhat broader type of technical analysis concentrates on the prediction of general market movements and trends relying on a broader set of information. Various market indicators are said to offer signals useful in forecasting future prices. One type seeks to measure investor sentiment through what might be called mood variables. A second type of indicator is more closely related to fundamental factors affecting future supply and demand for securities. Both types of indicators, however, are designed to be used in predicting future market movements rather than the movements of individual stock prices. This is to be contrasted with fundamental analysis which is concerned with predicting future prices of individual securities by analyzing the underlying factors related to the firm's future profitability. Most of the prior work with market indicators takes one or another proposed market indicator and examines the historical relation, between the indicator and some market index such as the Dow Jones Industrial Average.

Bank Holding Company Acquisitions and Their Impact on Market Shares: Comment

Abstract: Two major studies of bank holding company acquisitions have found that "holding company acquisitions . . . do not have a broad impact on the performance of acquired banks" [5, p. 13] (also see [4]). Nevertheless it has been generally assumed in regulatory agency analysis that holding company acquisitions will increase the market shares of the acquired banks because of presumed economies of scale. Studies have typically found economies as banks moved out of the lower deposit sizes, but there are serious methodological problems with these studies.l Two types of acquisitions have been singled out for special attention in policy discussions of bank acquisitions: those in which the leading banks in a market are acquired and those in which the smallest are acquired. The term entrenchment is used when an organization acquiring a leading bank is accused of improving the market position of the acquired bank or slowing its loss of market share. Acquisition of a small bank, foothold entry, can have the opposite competitive implication. If bank holding company acquisitions improve market position, the acquisition of nonleading banks would make them more effective competitors than otherwise, and these acquisitions should be encouraged for competitive reasons.2 This study tests the hypothesis that acquired banks increase their market shares. In addition, the conditions most conducive to improved market position of acquired banks are considered. A sample of 71 banks acquired by holding companies in the unit banking states between 1965 and 1970 was analyzed for change in market share of total deposits where the market was considered to be either an SMSA or a county (for nonSMSA markets). Since our main source of data, the FDIC's semiannual Report of Condition, allocates all deposits to a head office, market shares are obscured when a bank has offices in more than one market. Thus, data for banks in branching states could not be used. Furthermore, every bank in the sample was required to