You were recently hired by the Doolittle Corporation corporate treasury to help oversee its expansion...
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You were recently hired by the Doolittle Corporation corporate treasury to help oversee its expansion into Europe. Blake Francis, the CFO, wants to hire a foreign exchange forecasting company. Blake has asked you to evaluate three different companies, and he has obtained information on their past performances. Out of a total of 50 forecasts for the $/ rate, the companies reported the number of times they correctly forecast appreciations and depreciations. There are a total of 15 dollar appreciations (down periods) and 35 dollar depreciations (up periods) in the sample.
Correct Down Forecasts
Correct Up Forecasts
Morrissey Forex Advisors
5
20
Pixie Exchange Land
4
20
FOREX Cures
12
12
According to the HenrikssonMerton test, which firm(s) has (have) market timing ability?
Group of answer choices
According to the HenrikssonMerton test, no firm has market timing ability
Morrissey Forex Advisors
Pixie Exchange Land
FOREX Cures
More than one firm has market timing ability
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