Short-Horizon Empirical Validation of SIRRIPA: Structural Return Constraints and Relative Equity Performance
Abstract
This article provides an empirical validation of the Stock Internal Rate of Return Including Price Appreciation (SIRRIPA) using a point-in-time cross-section of U.S. technology stocks. SIRRIPA values are computed as of December 31, 2025 within a unified PPP-based valuation framework and confronted with realized equity performance over the subsequent period from January 1 to February 3, 2026. The analysis shows that higher ex-ante SIRRIPA values are associated with superior relative equity performance ex post, even over a very short horizon of approximately one month. Correlation analysis and portfolio-based tests indicate that SIRRIPA exhibits meaningful rank-ordering power, while traditional valuation multiples fail to do so. These empirical results are consistent with a structural interpretation of market dynamics, in which prices behave as constrained systems subject to return-based convergence forces rather than opinion-driven fluctuations.
Fields of Study & Subjects
Financial Markets and Investment Strategies
Financial Reporting and Valuation Research
Financial Analysis and Corporate Governance
Publication details
- Journal / source
- Zenodo (CERN European Organization for Nuclear Research)
- Publication date
- 5 February 2026
- Language
- EN
- Document type
- Preprint