The Dead Cat Bounce Theory Message Board

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Strategies & Market Trends : The Dead Cat Bounce Theory

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To: stockvalinvestor who wrote (29)	3/20/1997 2:16:00 AM
From: Ron Finberg	of 1836

Kenneth, I did a paper for a finance class a couple months ago on Dead Cat Theory. In my work I took top 10 losers of each day and held for 3months. I did theb research for one month's worth of stock in 5 different years. 1987(beforecrash),1988,1991, 1994, and early96. My tests showed that rebounding of a stock depended much on the market. 1987&96 yielded >35% gains, 1988&94 were really bad with mny stocks getting delisted, and 1991 yielded a 4% gain. Over the three month testing, it turned out that stocks that dropped between 20-25% posted the largest gains as huge losers >35% really didn't do so well with a cumalitive 7%, thanks to IOMEGA's quadrupaling after an early down side in Feb. All right, I thought this might be interesting, Ron

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