Investors Should Be Wary of Stock Buybacks During Down Times

question 176

True/False

Investors should be wary of stock buybacks during down times because the resulting decrease in shares and increase in earnings per share can be used to mask a slowdown in earnings growth.

---

Definitions:

Rank Correlation Coefficient

A statistic that measures the degree of association between two ranked variables, assessing the strength and direction of their relationship.

Population Spearman Correlation

A measure of the strength and direction of the monotonic relationship between paired data in a population using ranked values.

Sample Statistic

A numerical measure that describes an aspect of a sample taken from a population, such as the mean or variance.

Friedman Test

A statistical test that doesn't rely on parameter assumptions to identify variations in treatments over several trials.