THE FORECASTING ABILITY OF A MARKET MODEL FOR SHARES ISSUED BY PETROM S.A

(PIRSCOVEANU) Laura-Madalina Iacob and Cornelia-Cristina Pirscoveanu
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(PIRSCOVEANU) Laura-Madalina Iacob: Bucharest Academy of Economic Studies
Cornelia-Cristina Pirscoveanu: Bucharest Academy of Economic Studies

Revista Economica, 2021, vol. 73, issue Special, 230-242

Abstract: The scope of this paper is to make an empirical analysis regarding the market model introduced by the American economist Wiliam Sharpe (1963), a research developed based on the idea of portfolio simplification. In this paper, we tested the ability to predict a market model for shares issued by Petrom S.A. company. The result shows that the market model can be used to predict the profitability of a security, the forecast errors being insignificant. The results of this paper can help the investors to decide when to invest.

Keywords: market model; diversification; market profitability; share (search for similar items in EconPapers)
JEL-codes: G10 G11 G12 (search for similar items in EconPapers)
Date: 2021
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