This article is discussed relationship between volatility and predictability of profit. This is clear that one purposes of accounting and preparing financial statements, provide useful information to facilitate decision-making. With financial reports is done predictability for organization’s performance future. Accounting profit forecasts as a factor in economic decision-making are a favorite of investors, creditors, managers, financial analysts, and researchers. People can use this information in evaluation models, to improve the efficiency of capital markets, to assess their ability to pay, risk assessment, assessment of economic performance and stewardship of management, evaluation of how management accounting methods used in the discussion of income smoothing earnings forecasts for management decisions and use the economic, finance and accounting research. In this study to review and analyze the relationship between volatility and the ability to forecast profits in the short term and long term in an Iranian bank, in the period of 2009 till 2014. In fact, this article seeks to improve profit forecasts by variability of profits. The results show that the volatility of short-term and long-term profitability and predictability are inversely. The relationship between predictability and volatility is weaker than the relationship between predictability and the level of profits in the short-term and long-term. So, the current profit more appropriate tool to judge the predictability of earnings. Long-term and short-term profit trends mean reversion.
| Published in | Journal of Finance and Accounting (Volume 3, Issue 4) |
| DOI | 10.11648/j.jfa.20150304.12 |
| Page(s) | 69-76 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
| Copyright |
Copyright © The Author(s), 2015. Published by Science Publishing Group |
Profit, Volatility, Predictability, Long-Term and Short-Term
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APA Style
Yadollah Dakka, Malihe Rostami. (2015). The Relationship Between Volatility and Predictability of Profit. Journal of Finance and Accounting, 3(4), 69-76. https://doi.org/10.11648/j.jfa.20150304.12
ACS Style
Yadollah Dakka; Malihe Rostami. The Relationship Between Volatility and Predictability of Profit. J. Finance Account. 2015, 3(4), 69-76. doi: 10.11648/j.jfa.20150304.12
AMA Style
Yadollah Dakka, Malihe Rostami. The Relationship Between Volatility and Predictability of Profit. J Finance Account. 2015;3(4):69-76. doi: 10.11648/j.jfa.20150304.12
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Download@article{10.11648/j.jfa.20150304.12,
author = {Yadollah Dakka and Malihe Rostami},
title = {The Relationship Between Volatility and Predictability of Profit},
journal = {Journal of Finance and Accounting},
volume = {3},
number = {4},
pages = {69-76},
doi = {10.11648/j.jfa.20150304.12},
url = {https://doi.org/10.11648/j.jfa.20150304.12},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20150304.12},
abstract = {This article is discussed relationship between volatility and predictability of profit. This is clear that one purposes of accounting and preparing financial statements, provide useful information to facilitate decision-making. With financial reports is done predictability for organization’s performance future. Accounting profit forecasts as a factor in economic decision-making are a favorite of investors, creditors, managers, financial analysts, and researchers. People can use this information in evaluation models, to improve the efficiency of capital markets, to assess their ability to pay, risk assessment, assessment of economic performance and stewardship of management, evaluation of how management accounting methods used in the discussion of income smoothing earnings forecasts for management decisions and use the economic, finance and accounting research. In this study to review and analyze the relationship between volatility and the ability to forecast profits in the short term and long term in an Iranian bank, in the period of 2009 till 2014. In fact, this article seeks to improve profit forecasts by variability of profits. The results show that the volatility of short-term and long-term profitability and predictability are inversely. The relationship between predictability and volatility is weaker than the relationship between predictability and the level of profits in the short-term and long-term. So, the current profit more appropriate tool to judge the predictability of earnings. Long-term and short-term profit trends mean reversion.},
year = {2015}
}
TY - JOUR T1 - The Relationship Between Volatility and Predictability of Profit AU - Yadollah Dakka AU - Malihe Rostami Y1 - 2015/06/19 PY - 2015 N1 - https://doi.org/10.11648/j.jfa.20150304.12 DO - 10.11648/j.jfa.20150304.12 T2 - Journal of Finance and Accounting JF - Journal of Finance and Accounting JO - Journal of Finance and Accounting SP - 69 EP - 76 PB - Science Publishing Group SN - 2330-7323 UR - https://doi.org/10.11648/j.jfa.20150304.12 AB - This article is discussed relationship between volatility and predictability of profit. This is clear that one purposes of accounting and preparing financial statements, provide useful information to facilitate decision-making. With financial reports is done predictability for organization’s performance future. Accounting profit forecasts as a factor in economic decision-making are a favorite of investors, creditors, managers, financial analysts, and researchers. People can use this information in evaluation models, to improve the efficiency of capital markets, to assess their ability to pay, risk assessment, assessment of economic performance and stewardship of management, evaluation of how management accounting methods used in the discussion of income smoothing earnings forecasts for management decisions and use the economic, finance and accounting research. In this study to review and analyze the relationship between volatility and the ability to forecast profits in the short term and long term in an Iranian bank, in the period of 2009 till 2014. In fact, this article seeks to improve profit forecasts by variability of profits. The results show that the volatility of short-term and long-term profitability and predictability are inversely. The relationship between predictability and volatility is weaker than the relationship between predictability and the level of profits in the short-term and long-term. So, the current profit more appropriate tool to judge the predictability of earnings. Long-term and short-term profit trends mean reversion. VL - 3 IS - 4 ER -
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