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Stock Strategist

Six Reasons to Not Take Returns at Face Value, Part 2

Stock or fund returns may not tell the whole story.

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4. I own a stock that dropped 5% today. Am I 5% poorer?
Not necessarily. Over short time periods like a day or a week, there's evidence of return reversals. A stock that drops 5% tends, on the average, to get some of that return back.