Occurrences such as earnings surprises or stock splits that seem to present opportunity to generate abnormal returns for those trading on the news.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
Occurrences that present the opportunity for an abnormal return. For example, a company may announce the hiring of a well-regarded executive as CEO. This could cause the company's stock price to jump temporarily; a shareholder could sell some shares at the artificially high price, generating a higher return than the shareholder expected when he/she bought the stock. See also: Excess return.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved