Alex Chinco

Finance prof

[NBER @nberpubs]

The Campbell–Shiller log-linear approximation is not a universally valid accounting identity, because its interpretation and validity depend on restrictive assumptions about dividends, investor beliefs, and pricing models that often fail in real-world data, from Itzhak Ben-David and @alexchinco https://t.co/l27ERKSPzC

[NBER @nberpubs]

Characterizing the maximum EPS solution to three companion papers, from Itzhak Ben-David and @alexchinco https://t.co/TpHObYmCD5

[NBER @nberpubs]

Modeling a CEO looking to maximize EPS payout policy, from Itzhak Ben-David and @alexchinco https://t.co/v9uIieM5UG

[Justina Lee @justinaknope]

Remember how ETFs can rebalance without ever incurring capital-gains tax?

So what if you seed ETFs with appreciated stocks?

My story today on the latest idea from Wall Street's booming tax-alpha complex: https://t.co/2Ae8DVCj1T

[Alex Chinco @AlexChinco]

@profplum99 Not arguing that it’s the right thing to do, but comparing EY to Rf makes a lot of sense in a world where people are focused on maximizing EPS.

https://t.co/xZZgpOv2Sk

[Alex Chinco @AlexChinco]

@arpitrage @wagonomics

[Alex Chinco @AlexChinco]

@arpitrage @wagonomics

[Alex Chinco @AlexChinco]

@arpitrage @wagonomics Whose discount rates?

[Alex Chinco @AlexChinco]

@corry_wang You weren’t the only one… ImpliedPE = PriceTarget / E[EPS]

[Alex Chinco @AlexChinco]

@corry_wang Completely agree! We’re trying to bring this to researchers’ attention. Analysts put most of their time into E[EPS]. Then they ask themselves: “How has the market priced each $1 of the company’s earnings in the past?” Here’s how we put it on p5 in the intro:

[Alex Chinco @AlexChinco]

@wagonomics @arpitrage Here’s how we put it in the paper…

[Alex Chinco @AlexChinco]

@wagonomics @arpitrage Analysts spend most of their time on E[EPS]. Our point is that they convert E[EPS] into a price target by asking themselves: “How has the market priced each $1 of this company’s earnings in the past?” Regardless of how accurate E[Price] is, there’s no discount rate involved.

[Alex Chinco @AlexChinco]

@lukestein @arpitrage \texttimes are the best times

[Arpit Gupta @arpitrage]

Lots of research has gone into figuring out how sell side analysis (ie in IBES) form expectations. But if you read the reports, it turns out they forecast earnings per share and slap on a trailing P/E multiple

By @AlexChinco and Ben-David

https://t.co/IX0WbWRAit