Statman, Fisher, and Anginer (2008) found that stocks ranked high in Fortune's Survey of Most Admired Companies tended to have lower average risk-adjusted returns than the least admired firms. This could be attributed to
A) framing
B) mental accounting
C) affect
D) prospect theory

Question

Quizplus · Accepted Answer

The findings suggest that investors may be willing to pay a premium for stocks of companies they admire, which can lead to affect-driven decision making and lower risk-adjusted returns. Affect refers to emotions or feelings that can influence decision making.

Statman, Fisher, and Anginer (2008) Found That Stocks Ranked High