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Accounting Fundamentals Explain the Size Premium in Stock Returns and Its Variation Over Time

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Journal of Accounting, Auditing & Finance

Published online on

Abstract

Journal of Accounting, Auditing & Finance, Ahead of Print.
Considerable research reports that small firms typically yield higher stock returns than large firms, though this varies over time. The size premium is usually attributed to higher risk in smaller firms. The paper documents that the risk is to future ...