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Conditional versus unconditional persistence of RNOA components: implications for valuation

Review of Accounting Studies, 2010
Financial analysis often involves decomposing variables into components, emphasizing the structured hierarchy among ratios. We distinguish between unconditional persistence (a variable’s autocorrelation coefficient), and conditional persistence (the power of a variable’s persistence to explain the persistence of a variable higher in the hierarchy).
Eli Amir, Itay Kama, Joshua Livnat
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