Tests of overreaction effect in Istanbul Stock Exchange
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Please cite this item using this persistent URLhttp://hdl.handle.net/11693/17529
Overreaction hypothesis claims that extereme movements in stock prices will be followed by subsequent price movements in the opposite direction, and the more extreme initial price movement, the greater will be the subsequent price adjustment. Therefore the information in past prices or returns can be used for achieving excess returns in future. In this study, the hypothesis is tested for Istanbul Stock Exchange first common market's adjusted-price data. The period covered is 1 January 1988, and December 31, 1991. The emprical evidence, is consistent with the overreaction hypothesis for 17 diffrent periods at ISE market. Substantial weak form market inefficiencies are discovered. The results are also supported by T- test results.