scholarly journals Active Funds and Bundled News

2021 ◽  
Author(s):  
Charles M. C. Lee ◽  
Christina Zhu
Keyword(s):  
Price Discovery ◽  
Market Price ◽  
Earnings Announcements ◽  
Price Adjustment ◽  
Level Data ◽  
Managed Funds

We use trade-level data to examine the role of actively managed funds (AMFs) in earnings news dissemination. We find AMFs are drawn to, and participate disproportionately more in, earnings announcements (EAs) that include bundled managerial guidance. When the two pieces of news are directionally inconsistent, AMFs trade in the direction of future guidance rather than current earnings. AMFs exhibit an ability to discern, and adapt their trading to, the bias in bundled guidance. While AMF trades at EAs are generally more profitable than their non-EA trades, this result reverses when guidance bias is extreme. Overall, we find increased AMF trading during EAs leads to faster price adjustment. Collectively, these findings suggest AMFs are sophisticated processors of bundled earnings news, and their trading generally improves market price discovery.

Strategic Trading at the Preopening after Earnings Announcements

2020 ◽  
pp. 0000-0000
Author(s):  
Shai Levi ◽  
Xiao-Jun Zhang
Keyword(s):  
Price Discovery ◽  
Earnings Announcements ◽  
Price Adjustment ◽  
Strategic Trading ◽  
Prior Literature

Prior literature finds the price adjustment after earnings announcements is not immediate. This paper provides evidence that informed investors act strategically to prevent their information from immediately affecting prices after earnings announcements. Specifically, we examine the price discovery at the preopening auction after earnings announcements. We show that traders place more orders at the end of the preopening after earnings announcements, a behavior that reduces the market's ability to learn their information, and we find they profit from these late orders.

scholarly journals The Role of Precision Timing in Stock Market Price Discovery when Trading through Distributed Ledgers

2019 ◽  
Vol 10 ◽  
pp. 1-8 ◽  
Author(s):  
Daniel Broby ◽  
Devraj Basu ◽  
Ashwin Arulselvan ◽  
◽  
◽  
...  
Keyword(s):  
Stock Market ◽  
Price Discovery ◽  
Market Price

Analyst Forecast Revisions and Market Price Discovery

2003 ◽  
Vol 78 (1) ◽  
pp. 193-225 ◽  
Author(s):  
Cristi A. Gleason ◽  
Charles M. C. Lee
Keyword(s):  
Price Discovery ◽  
Market Price ◽  
Price Adjustment ◽  
Adjustment Process ◽  
Analyst Forecast ◽  
Wall Street ◽  
Cross Sectional ◽  
Analyst Coverage ◽  
Forecast Revisions ◽  
New Information

We document several factors that help explain cross-sectional variations in the post-revision price drift associated with analyst forecast revisions. First, the market does not make a sufficient distinction between revisions that provide new information (“high-innovation” revisions) and revisions that merely move toward the consensus (“low-innovation” revisions). Second, the price adjustment process is faster and more complete for “celebrity” analysts (Institutional Investor All-Stars) than for more obscure yet highly accurate analysts (Wall Street Journal Earnings-Estimators). Third, controlling for other factors, the price adjustment process is faster and more complete for firms with greater analyst coverage. Finally, a substantial portion of the delayed price adjustment occurs around subsequent earnings-announcement and forecast-revision dates. Collectively, these findings show that more subtle aspects of an earnings revision signal can hinder the efficacy of market price discovery, particularly in firms with relatively low analyst coverage, and that subsequent earnings-related news events serve as catalysts in the price discovery process.

What's Happening to Profits at Cazenovia Creations?

2013 ◽  
Vol 8 (1) ◽  
pp. 24-29 ◽  
Author(s):  
Margaret Garnsey ◽  
Andrea Hotaling
Keyword(s):  
Financial Analysis ◽  
Financial Statements ◽  
Internal Controls ◽  
Net Income ◽  
Database Query ◽  
Microsoft Access ◽  
Level Data ◽  
Query Tool ◽  
Transaction Level

ABSTRACT In this case, students assume the role of an accounting professional asked by a client to investigate why net income is not as strong as expected. The students must first analyze a set of financial statements to identify areas of possible concern. After determining the areas to investigate, the students use a database query tool to see if they can determine causes by examining transaction level data. Finally, the students are asked to professionally communicate their findings and recommendations to their client. The case provides students with experience in using query-based approaches to answering business questions. It is appropriate for students with basic query and financial analysis skills and knowledge of internal controls. A Microsoft Access database with transaction details for the final seven months of the current year as well as financial statements for the current and prior year are provided.

Financial Access of Latin America and Caribbean Firms: What Are the Roles of Institutional, Financial, and Economic Development?

2021 ◽  
pp. 097265272110153
Author(s):  
Lan Khanh Chu
Keyword(s):  
Economic Development ◽  
Latin America ◽  
Jel Classification ◽  
Caribbean Region ◽  
Country Level ◽  
Level Data ◽  
Latin America And Caribbean ◽  
The Impact ◽  
Moderating Role

This article examines the impact of institutional, financial, and economic development on firms’ access to finance in Latin America and Caribbean region. Based on firm- and country-level data from the World Bank databases, we employ an ordered logit model to understand the direct and moderating role of institutional, financial, and economic development in determining firms’ financial obstacles. The results show that older, larger, facing less competition and regulation burden, foreign owned, and affiliated firms report lower obstacles to finance. Second, better macro-fundamentals help to lessen the level of obstacles substantially. Third, the role of institutions in promoting firms’ inclusive finance is quite different to the role of financial development and economic growth. JEL classification: E02; G10; O16; P48

scholarly journals Role of index futures on China's stock markets: Evidence from price discovery and volatility spillover

2017 ◽  
Vol 44 ◽  
pp. 13-26 ◽  
Author(s):  
Hong Miao ◽  
Sanjay Ramchander ◽  
Tianyang Wang ◽  
Dongxiao Yang
Keyword(s):  
Stock Markets ◽  
Price Discovery ◽  
Volatility Spillover ◽  
Index Futures

scholarly journals How Johnson Fought the War on Poverty: The Economics and Politics of Funding at the Office of Economic Opportunity

2014 ◽  
Vol 74 (2) ◽  
pp. 351-388 ◽  
Author(s):  
Martha J. Bailey ◽  
Nicolas J. Duquette
Keyword(s):  
New Deal ◽  
War On Poverty ◽  
Economic Opportunity ◽  
Johnson Administration ◽  
Level Data ◽  
Office Of Economic Opportunity ◽  
Economic Opportunity Act ◽  
Political Variables ◽  
Economics And Politics

This article presents a quantitative analysis of the geographic distribution of spending through the 1964 Economic Opportunity Act (EOA). Using newly assembled state- and county-level data, the results show that the Johnson administration directed funding in ways consistent with the War on Poverty's rhetoric of fighting poverty and racial discrimination: poorer areas and those with a greater share of nonwhite residents received systematically more funding. In contrast to New Deal spending, political variables explain very little of the variation in EOA funding. The smaller role of politics may help explain the strong backlash against the War on Poverty's programs.

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