Guides

Background reading

Short answers to the questions this project keeps coming back to, each backed by the same data the site is built on.

• Does the earnings gap predict the next move?
  The headline test: no reliable edge survives a market adjustment, out-of-sample split, and costs.
• What is post-earnings announcement drift?
  The classic underreaction anomaly since 1968 — real, but concentrated in small caps and reliant on surprise data.
• Which sector has the biggest earnings reactions?
  Tech gaps the most (5.9% average), Utilities the least (1.2%) — but a bigger reaction doesn't mean a more predictable one.
• Does buying stock before earnings work?
  The overnight reaction is close to a coin flip (51.8% up, 47.4% down), and the days after don't reliably make up for the risk either.
• How big is the average earnings move?
  About 3.9% either way on average, but a 2.5% median — a typical report is smaller than the average, and the tail is where the risk lives.