2 papers
econ.GN2026
When and Why Naïve Diversification Works: A Simple Diagnostic Strategy
Han Feng, Difang Huang, Jue Wang +1
We explain the long-standing puzzle of naïve diversification with a simple, testable condition: equal weighting is minimum-variance optimal when the forecast-error covariance matri…
econ.GN2026
Technology Fundamentals and False Bubble Detection: Evidence from Dot-Com and AI Episodes
Haiqiang Chen, Li Chen, Difang Huang +2
We show that widely used bubble tests, most prominently the PSY framework, suffer severe size distortion when fundamentals incorporate general-purpose technology adoption. Embeddin…