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You Have Just Completed a Study of Small and Large

Question 45

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You have just completed a study of small and large stocks and have obtained the following results:
s  small stocks  large stocks  excess returns 5%0% transactions cost 10%2%\begin{array} { l c c } & \text { small stocks } & \text { large stocks } \\\text { excess returns } & 5 \% & 0 \% \\\text { transactions cost } & 10 \% & 2 \%\end{array}

Given the difference in transactions costs,how long would your investment horizon have to be for small stocks to be a better investment than large stocks?

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Horizon at which returns on small stocks...

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