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Timely Disclosures (timely + disclosure)

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

Selected Abstracts

A Re-examination of Disclosure Level and the Expected Cost of Equity Capital

JOURNAL OF ACCOUNTING RESEARCH, Issue 1 2002
Christine A. Botosan
This paper examines the association between the cost of equity capital and levels of annual report and timely disclosure, and investor relations activities. We estimate the cost of equity capital using the classic dividend discount model. We find that the cost of equity capital decreases in the annual report disclosure level but increases in the level of timely disclosures. The latter result is contrary to theory but is consistent with managers' claims that greater timely disclosures may increase the cost of equity capital, possibly through increased stock price volatility. We find no association between the cost of equity capital and the level of investor relations activities. We conclude that aggregating across different disclosure types results in a loss of information. Failing to include all disclosure types in regression analyses may lead to a correlated omitted variable bias and erroneous conclusions. [source]

Short-Selling Prior to Earnings Announcements

THE JOURNAL OF FINANCE, Issue 4 2004
Stephen E. Christophe
ABSTRACT This paper examines short-sales transactions in the five days prior to earnings announcements of 913 Nasdaq-listed firms. The tests provide evidence of informed trading in pre-announcement short-selling because they reveal that abnormal short-selling is significantly linked to post-announcement stock returns. Also, the tests indicate that short-sellers typically are more active in stocks with low book-to-market valuations or low SUEs. The levels of pre-announcement short-selling, however, mostly appear to reflect firm-specific information rather than these fundamental financial characteristics. We believe that these results should encourage financial market regulators to consider providing more extensive and timely disclosures of short-selling to investors. [source]