We examine the relation between earnings information content and the use of trust words, such as "character," "ethics," and "honest," in the MD&A section of 10-K. We find that earnings announcements of firms using trust words have lower information content than earnings announcements of firms...

This study investigates whether internet articles, such as blog or internet community posts, enhance investors’ ability to process uncertain news (i.e., rumors). Using the unique disclosure requirement in Korea, which verifies rumors by firms’ disclosures, we identify trading activities...

Purpose: The purpose of this paper is to investigate whether analysts’ optimism affects the stock crash risk. Design/methodology/approach: The sample covers 49,246 firm-year observations for the period between 1995 and 2015. The authors use OLS regressions with firm and year fixed effects for...

We show that a firm's one-year-ahead capital investments and inventory increase (decrease) when peer firms' MD&A narratives become more optimistic (pessimistic). This finding is driven by firms that access peer firms' 10-K filings within seven days of filing, and remains after controlling for...