Recent evidence suggests that emotions play an important role in the valuation of companies. Employing a unique database, we examine the impact of emotions on how investors react to information in the period after the release of the information. We find that the prevailing emotions at any point...

Recent studies suggest that investor emotions might cause securities to be mispriced. We build an investment strategy around the mispricing opportunities identified in two papers that have examined how emotions influence investor reaction to earnings announcements. This strategy proves to be...

Despite much discussion in the psychology and marketing literature as to how emotions influence decision-making, this area of analysis has been largely neglected in the finance literature. We redress this important gap by using proxies for emotions drawn from the news and social media to...