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Larry Lockwood’s Advice on Near-Term Investments Featured in US News & World Report

In today's efficient market, a stock price is likely to have tomorrow's news built into its price, said Larry Lockwood, the Stan Block Endowed Chair in Finance.

April 19,  2018

By Elaine Cole

In a U.S. News & World Report article on near-term investing, which the article says aims to improve returns by playing on events that are expected to occur sooner rather than later, TCU Finance Professor Larry Lockwood states that today’s price shares usually contain all available current information and future expectations. 

“For instance, if the consensus forecast for upcoming earnings is $2 per share, then the current stock price likely will reflect that expectation in advance of the actual earnings announcement,” he states in the article. 

Lockwood adds that some investors may disagree with the consensus. “Optimistic investors might want to buy or add to the stock position, and pessimistic investors might want to sell or trim the stock position.”

This approach is risky since either group of investors could wind up on the wrong side of a trade.

Lockwood is featured frequently in major media outlets offering financial advice. He is the faculty advisor to the TCU Educational Investment Fund and also teaches the Chartered Financial Analyst track. 

The U.S. News article, “Capitalize on a Near-Term Investing Trend,” offers advice from experts, including Lockwood, to capitalize on more immediate market triggers: diversify, be aware of behavioral bias and stick to your larger plan. 

Read the entire article here: https://money.usnews.com/investing/investing-101/articles/2018-04-17/near-term-investing-is-the-next-best-thing-to-a-market-crystal-ball.