Under the Microscope: When Stocks and the Economy Diverge

1. Researchers often cite a t-statistic value of 2.0 as the threshold for statistical reliability.

GLOSSARY

Macroeconomic data: Data used to measure the output of an economy, such as employment or production.

Gross domestic product: The total value of goods and services produced by, for example, a country over a set period of time.

Debt-to-GDP: The ratio of a company’s debt to its gross domestic product.

Fama/French Total US Market Research Index: The value-weighed US market index is constructed every month, using all issues listed on the NYSE, AMEX, or Nasdaq with available outstanding shares and valid prices for that month and the month before. Exclusions: American depositary receipts. Sources: CRSP for value-weighted US market return. Rebalancing: Monthly. Dividends: Reinvested in the paying company until the portfolio is rebalanced.

Sincerely, 

P.J. DiNuzzo, CPA, PFS™, AIF®, MBA, MSTx
President, Founder, and Chief Investment Officer