老师麻烦解释下这道题可以吗 不太懂

问题如下：

The observation that a large-capitalization company's stock price is inflated after the company releases unexpected good news at year end is most likely related to the:

选项：

A.value effect.

B.overreaction effect.

C.turn-of-the-year effect.

解释：

1. Incorrect because the value effect is a market anomaly that value stocks, which are generally referred to as stocks that have below-average price-to-earnings (P/E) and market-to-book (M/B) ratios, and above-average dividend yields, have consistently outperformed growth stocks over long periods of time. This is a cross-sectional anomaly and is not related to an information release.

2. Correct because the overreaction effect or anomaly is described as the propensity for investors (to) overreact to the release of unexpected public information. Therefore, stock prices will be inflated (depressed) for those companies releasing good (bad) information. In other words, inflated (depressed) here means the change of value that is overshooting (undershooting) the fair (intrinsic) value after incorporating the new information, rather than the price action that goes up (down) itself.

3. Incorrect because the turn-of-the-year effect is a calendar anomaly that stock market returns in January were significantly higher compared to the rest of the months of the year, with most of the abnormal returns reported during the first five trading days in January. This is a time-series anomaly related to the calendar but not an information release.

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