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Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International

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Working Paper

Publication Date



National Bureau of Economic Research




This paper examines the dissemination of market timing information (signals on the overall performance ofrisky assets relative to the risk free rate). We consider two delivery systems. Under the newsletter deliverysystem market timing information is disseminated solely through newsletter. Under the fund deliverysystem, timers set up timing funds in which investors can invest. In the absence of market imperfections we find that both systems produce the same result. With restrictions on borrowing or with other nonlinearities we find the newsletter system to be superior. This is one possible explanation for the plethora of markettiming newsletters and the paucity of market timing funds.

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