Harvard MBA Indicator

What is Harvard MBA Indicator?

The right time for entering the stock Market happens to be one of the most difficult decisions for investors. It is often hard to decide when you should sell your stocks or when to make a long-term purchase. That’s what the Harvard MBA Indicator definition helps you with. As the name suggests, this indicator help people determine the popularity of the stock market and finance industries based on the number of Harvard Graduates working in the market-sensitive industries.

The indicator calculates the total percentage of students from Harvard Business School entering the market-sensitive Industry after graduation. The Harvard MBA indicator is used to measure future stock performance considering the total number of Harvard graduates that choose market-sensitive jobs.

An Overview of the Harvard MBA Indicator

This indicator helps investors know the total percentage of students from Harvard Business School that pursue their career in the market-sensitive sectors. Now, these jobs include equity, investments and trading, banking, and trade of other such securities. If the Harvard MBA indicator shows 30% of Harvard graduates being part of the market-sensitive jobs, then it generates a sell signal for securities. However, if the percentage of graduates pursuing their careers in the banking, investment, and finance industry falls below 10, then the indicator generates a long-term purchase signal for securities.

Harvard MBA Indicator was launched and operated by a popular Harvard graduate namely Roy Soifer. The method was used in the years 1987 and 2000 to generate stock signals. In 1987 and 2000, the stock market was in a depression period. This long-term stock market indicator was meant to find out the future of the stock market based on the number of Harvard graduates that apply for jobs in the market-sensitive industry. It goes without saying that the more number of Harvard graduates choose to enter the stock market industry, the better the industry is performing, and the higher the chances it will grow. On the other hand, the stock market isn’t doing great if the graduates from Harvard are not interested in joining the market-sensitive industry.

How Does it Work?

This indicator also suggests the fact that when more and more people are entering the market, it is the right time for you to get out. The indicator helps experts and aspiring investors detect the stock market condition based on the employment choices the Harvard graduates make. In other words, the best time for investors to sell their securities is when a large number of students from Harvard Business School choose to build their careers around finance, banking, and other such market-sensitive industries.

Likewise, the investors must consider buying stocks when only a small percentage of Harvard graduates choose the stock market, investment, financing, and trading industries for their careers. As mentioned before, you must enter the stock market and an investment deal when less than 10% of people graduate from the Harvard Business School consider joining the stock trading industry.

Here, the success of the stock market is calculated based on the popularity of this industry among Harvard graduates.