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Market timing and statistical arbitrage: Which market timing opportunities arise from equity price busts coinciding with recessions

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Even though a random walk process is from a statistical point of view not predictable, some movements can be correlated with specific events concerning other variables. Then, predictable patterns may arise being dependent on this joint event. There is evidence given that equity price busts being associated with recessions continue until the economy switches from the state of recession to an economic pick-up.
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Market timing and statistical arbitrage: Which market timing opportunities arise from equity price busts coinciding with recessions

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