We use quarterly institutional ownership changes to test the effect of investment horizon on institutional investors' incentives to acquire private information on long term earnings. Short horizon institutions' ownership changes contain private information on long term earnings, but only to the...

This study offers evidence on the earnings forecast bias analysts use to please firm management and the associated benefits they obtain from issuing such biased forecasts in the years prior to Regulation Fair Disclosure. Analysts who issue initial optimistic earnings forecasts followed by...

We investigate if the SEC's mandated disclosure of fees for audit and nonaudit services affected the market's perception of auditor independence and earnings quality. Following the initial fee disclosures, we find that the market valuation of quarterly earnings surprises (earnings response...

This study uses Reg FD to determine the relative importance of analysts' private information from firm management versus independent research. Using earnings-related closed conference calls as a proxy for the private communication between management and analysts and the informativeness of stock...

This study provides empirical evidence that equity-based incentives (stock and stock options) encourage CEOs to manage earnings to increase short run stock prices so that they can cash out a portion of their equity holdings at inflated prices. CEOs who hold high equity-based incentives are more...

We provide evidence that transient institutional investors (i.e., those actively trading to maximize short term profits) trade to exploit the post-earnings announcement drift (PEAD). We estimate that transient institutions' arbitrage generates an abnormal return of 5.1 percent (or 22 percent...

We investigate if the SEC's mandated disclosure of fees for audit and nonaudit services affected the market's perception of auditor independence and earnings quality. Following the initial fee disclosures, we find that the market valuation of quarterly earnings surprises (earnings response...

Evidence contrasting U.S. insider trades in high- and low-jeopardy periods and across firms at high and low risk for 10b-5 litigation indicates that insiders condition their trades on foreknowledge of price-relevant public disclosures, but avoid profitable trades when the jeopardy associated...

We investigate the relationship between insider trading and candidate measures for the degree of information asymmetry between insiders and other market participants. The coefficient estimates on certain of the candidate measures assume a sign that is inconsistent with the predicted relationship...

Using a corporate lobbying event that led to the unexpected reversal of a tough insider trading blackout regulation in Hong Kong, we examine whether tightening the restrictions of insider trading in family firms-dominated financial markets affects shareholder value. We find that firms more...