SWF: Stands for Stocks Weaken Faster?

There's further evidence today why SWFs (sovereign wealth funds) aren't exactly seen as smart money:

Using an event study parameter approach, we find the short-run market reaction to be statistically insignificant in 11 out of 12 announcements of SWF investments; but in the long run SWF-targets underperform both the S&P500 and the Dow Jones Financial Services Index Fund.

[Jory, Surendranath, Perry, Mark J. and Hemphill, Thomas A.,Shanghai, Dubai, Mumbai or Goodbye?(July 26, 2008)]

Feel free to come up with your own re-translation of SWF, but I'm using Stocks Weaken Faster for now.

 

Comments

[GaryD:]

That study you cite starts its analysis in 2007, and then goes on to make conclusions about "the long run". Any analysis that starts in 2007 cannot in any seriousness claim to make conclusions about the long run performance of anything. Oh wait, Mark Perry is one of the authors. Now it makes sense.

2008 Jul 30 10:27 PM