Stock Trades: Funds and University

stock trades: That rationale that even skilled fund managers can't beat the stock-market indices, so there's no reason to pay someone to try, according to Market Watch. Not true, write finance and accounting professors Linda Chen of the University of Idaho, Wei Huang of the College of Saint Benedict & Saint John's University, and George Jiang of Washington State University, after an exhaustive study of nearly 2,000 U.S. mutual funds' stock trades by month from January 1998 to March 2015. An analysis of mutual-fund stock trades over the past two decades has thrown into question the rationale that has sent everybody and her grandmother stampeding into low-cost index funds and exchange traded funds. Instead, their research found substantial evidence that many skilled money managers are adept at picking stocks. And, critically, they are good at picking the stocks that are going to beat earnings expectations ahead of time L arge active trades by mutual funds prior to the month of earnings announcements have significantly positive abnormal returns in the subsequent one-, two- and three-month horizons, they wrote. Mutual fund trades outperform their benchmarks, they wrote. (news.financializer.com). As reported in the news.