Definitionof'SkirtLengthTheory'
Theideathatskirtlengthsareapredictorofthestockmarketdirection.Accordingtothetheory,ifskirtsareshort,itmeansthemarketsaregoingup.Andifskirtarelong,itmeansthemarketsareheadingdown.AlsocalledtheHemlineTheory.
Investopediaexplains'SkirtLengthTheory'
Theideabehindthistheoryisthatshorterskirtstendtoappearintimeswhengeneralconsumerconfidenceandexcitementishigh,meaningthemarketsarebullish.Incontrast,thetheorysayslongskirtsarewornmoreintimesoffearandgeneralgloom,indicatingthatthingsarebearish.
Althoughsomeinvestorsmaysecretlybelieveinsuchatheory,seriousanalystsandinvestors-insteadofexaminingskirtlengthtomakeinvestmentdecisions-insistonfocusingonmarketfundamentalsanddata.