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Have you ever wondered how financial markets move? Professor Praveen Kumar with the Bauer College of Business at the University of Houston says the key is information and who has it.
“Our modern economy is incredibly dynamic and complex. Literally by the second, we get new information on technology, government decisions and global pandemics. This creates huge dispersion in information among different types of investors and executives and outside investors.”
“The gyrations in stock and bond markets occur as investors try and adapt to new information. Company decisions like CEO compensation and paying dividends while in financial trouble can also be understood through non-transparent information. Information is the key that unlocks many puzzles regarding financial markets.”
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