The Rational Reminder Podcast cover image

The Rational Reminder Podcast

Episode 342 - Matthew Ringgenberg: When Do Anomaly Returns Happen?

Jan 30, 2025
Matthew Ringgenberg, a finance professor at the University of Utah, dives into the intriguing realm of anomaly returns. He defines asset pricing anomalies and discusses when these returns emerge in relation to signal information releases. The conversation touches on the predictive power of various models and explores the significance of equity loan fees in forecasting market outcomes. Ringgenberg also argues for the necessity of long-term happiness as a measure of true success, challenging conventional investment wisdom.
41:55
Creator website

Episode guests

Matthew Ringgenberg

Podcast summary created with Snipd AI

Quick takeaways

  • An asset pricing anomaly reveals patterns predicting future stock returns, emphasizing the need for quick trading to capture these premiums.
  • Research indicates that many popular market predictors lack systematic reliability, often resembling random chance rather than providing useful timing information.

Deep dives

Understanding Anomaly Returns

An asset pricing anomaly refers to a pattern that predicts future stock returns, often leading to abnormal returns. Recent research highlighted by a finance professor explores the timing of these anomalies, specifically how quickly return premiums manifest after information is released. For instance, the asset growth anomaly shows that returns are concentrated around the date when relevant financial information is first available, suggesting that quick trading is essential to capturing these premiums. This insight challenges academic convention, which often relies on outdated portfolio formations and can erroneously diminish the perceived strength of these anomalies.

Remember Everything You Learn from Podcasts

Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
App store bannerPlay store banner