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Regulation FD (regulation + fd)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting100%

Selected Abstracts

The Impact of Regulation FD on Institutional Investor Informativeness

FINANCIAL MANAGEMENT, Issue 3 2010
Douglas O. Cook
Although there is conflicting evidence and resulting skepticism regarding the value provided by professional investment management, Gibson, Safieddine, and Sonti (2004) document institutional investor informativeness relative to seasoned equity offering (SEO) purchases. We find that Regulation Fair Disclosure's significantly reduces institutional investors' ability to identify mispriced SEO firms. Informativeness is diminished not by investors following analysts who have experienced a reduction in forecasting accuracy, but limiting investors' direct access to private information. This information loss is replaced by reliance on a greater number of public information variables resulting in less consideration for prudence proxies and a liquidity motive and more for higher price momentum. [source]

Information, Selective Disclosure, and Analyst Behavior

FINANCIAL MANAGEMENT, Issue 1 2009
Anchada Charoenrook
This paper examines whether the prohibition of selective disclosures to equity research analysts mandated by Regulation FD alters the amount of information and the manner in which it is revealed to the market. We demonstrate that equity research analysts are more responsive to information contained in company-initiated disclosures after Reg FD, suggesting that regulation has affected the importance of various channels of communication. We also present evidence consistent with the notion that managers use earnings guidance as a substitute for selective disclosure following the passage of Reg FD. [source]

An Examination of the Differential Impact of Regulation FD on Analysts' Forecast Accuracy

FINANCIAL REVIEW, Issue 1 2006
Scott Findlay
G14; G18; G24; G38 Abstract Regulation fair disclosure (FD) requires companies to publicly disseminate information, effectively preventing the selective pre-earnings announcement guidance to analysts common in the past. We investigate the effects of Regulation FD's reducing information disparity across analysts on their forecast accuracy. Proxies for private information, including brokerage size and analyst company-specific experience, lose their explanatory power for analysts' relative accuracy after Regulation FD. Analyst forecast accuracy declines overall, but analysts that are relatively less accurate (more accurate) before Regulation FD improve (deteriorate) after implementation. Our findings are consistent with selective guidance partially explaining variation in the forecasting accuracy of analysts before Regulation FD. [source]

The Effect of Regulation Fair Disclosure on Conference Calls: The Case of Earnings Surprises,

ASIA-PACIFIC JOURNAL OF FINANCIAL STUDIES, Issue 6 2009
Bok Baik
Abstract While conference calls have been widely used as a communication tool between firms and investors, little research has examined the effect of this voluntary disclosure metric on analyst forecasts. In this paper, we examine whether firms use conference calls to guide down analysts' earnings forecasts, thereby avoiding negative earnings surprises before and after Regulation FD. Our findings show that firms hosting conference calls are more likely to guide analysts' forecasts downward and, as a result, they tend to successfully avoid negative earnings surprises in the pre Reg FD period. However, we do not find such relations in the post Reg FD period. We also find that the market reacts positively to firms hosting conference calls only in the post Reg FD period, consistent with the view that the market rewards a reduction in managers' opportunistic guidance to meet the analysts' earnings estimate. [source]