________ have historically earned ________ returns than the market portfolio.

Question

Quizplus · Accepted Answer

Small stocks have historically earned higher returns than the market portfolio. This is known as the small-cap premium, which is the additional return that investors earn by investing in smaller companies. Empirical evidence suggests that this premium persists even after adjusting for risk factors such as size, value, and momentum. In contrast, big stocks have lower average returns than the market portfolio, as they are often mature companies with lower growth prospects.

________ Have Historically Earned ________ Returns Than the Market Portfolio

Have Historically Earned Returns Than the Market Portfolio