Do Analysts Herd

DOWNLOAD

Download Do Analysts Herd PDF/ePub or read online books in Mobi eBooks. Click Download or Read Online button to get Do Analysts Herd book now. This website allows unlimited access to, at the time of writing, more than 1.5 million titles, including hundreds of thousands of titles in various foreign languages. If the content not found or just blank you must refresh this page

Do Analysts Herd

DOWNLOAD
Author : Narasimhan Jegadeesh
language : en
Publisher:
Release Date : 2007

Do Analysts Herd written by Narasimhan Jegadeesh and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with Investment analysis categories.

This paper develops and implements a new test to investigate whether sell-side analysts herd around the consensus when they make stock recommendations. Our empirical results support the herding hypothesis. Stock price reactions following recommendation revisions are stronger when the new recommendation is away from the consensus than when it is closer to it, indicating that the market recognizes analysts' tendency to herd. We find that analysts from larger brokerages and analysts following stocks with smaller dispersion across recommendations are more likely to herd.

Do German Security Analysts Herd

DOWNLOAD
Author : Marcel Naujoks
language : en
Publisher:
Release Date : 2009

Do German Security Analysts Herd written by Marcel Naujoks and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2009 with categories.

In this study, we employ an innovative new methodology suggested by Bernhardt et al. (2006) to examine the herding (or anti-herding) behavior of German analysts in case of earnings forecasts. Our methodology avoids well-known shortcomings often encountered in related studies, such as, e.g., correlated information signals, unexpected common shocks to earnings, systematic optimism or pessimism or forecast target mismeasurement. Our findings suggest that German analysts anti-herd, i.e., they systematically issue earnings forecasts which are further away from the consensus forecast than their private information indicates. Furthermore, we analyze the association between herding behavior and different characteristics which might influence analysts' herding behavior, like the size of the brokerage, the experience of the analyst and the coverage of firms of the Neuer Markt. We mainly confirm findings for the U.S., e.g., that the anti-herding phenomenon is more severe in cases of higher competition among analysts. Contrary to anecdotal evidence, we also find anti-herding behavior when analysts issue forecasts for Neuer Markt firms during the 'new economy' bubble.

Herding In Analysts Recommendations

DOWNLOAD
Author : Bart Frijns
language : en
Publisher:
Release Date : 2018

Herding In Analysts Recommendations written by Bart Frijns and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018 with categories.

This study investigates the impact of media on analysts' herding behavior when making stock recommendations. We find three main results. First, we find that analysts herd less when stocks are covered more in the media. Second, when the firm has negative media sentiment, analysts tend to herd more. Third, higher disagreement in the media is associated with a higher tendency to herd among analysts. These findings are robust to the confounding effect of news flows on returns as well as to alternative explanations. In addition, we find that the effect of media on the herding behavior is conditional on analyst characteristics.

Analysts Herding Propensity

DOWNLOAD
Author : Murugappa (Murgie) Krishnan
language : en
Publisher:
Release Date : 2007

Analysts Herding Propensity written by Murugappa (Murgie) Krishnan and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.

We model and estimate analysts' herding propensity with I/B/E/S annual earnings forecast data. Compared to prior studies, our paper has three unique features. First, we estimate analysts' true posterior beliefs of a firm's earnings assuming rational expectations rather than using analysts' own prior forecasts. Second, we estimate analysts' herding propensity at aggregate and the analyst levels rather than the forecast level. Third, we perform out-of-sample rather than in-sample tests on the usefulness of our herding propensity estimates. We document pervasive herding behavior. At the aggregate level, we find that herding propensity is positively related to forecast horizon and analyst coverage, but negatively related to analysts' general experience and brokerage size. At the analyst level, we find that about 75% (15%) of the analysts in our sample tend to herd (anti-herd). Moreover, our in-sample herding propensity estimates are useful in explaining the cross-sectional variation in analysts' out-of-sample herding behavior and forecast accuracy.

Measuring Herding And Exaggeration By Equity Analysts And Other Opinion Sellers

DOWNLOAD
Author : Eric Zitzewitz
language : en
Publisher:
Release Date : 2003

Measuring Herding And Exaggeration By Equity Analysts And Other Opinion Sellers written by Eric Zitzewitz and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2003 with categories.

Firms and individuals who sell opinions may bias their reports for either behavioral or strategic reasons. This paper proposes a methodology for measuring these biases, particularly whether opinion producers under or over emphasize their private information, i.e. whether they herd or exaggerate their differences with the consensus. Applying the methodology to I/B/E/S analysts reveals that they do not herd as is often assumed, but rather they exaggerate their differences with the consensus by an average factor of about 2.4. Analysts also overweight their prior-period private information and thus under-update based on last period's forecast error; this under-updating helps explain the apparently conflicting over and under-reaction results of DeBondt and Thaler (1990) and Abarbanell and Bernhard (1992). A useful by-product of the methodology is a measure of the incremental information content of an analyst's forecasts. Using this measure reveals that analysts differ greatly in performance: the information content of the future forecasts of the top 10 percent of analysts is roughly six times that of the bottom 40 percent.

Herding Among Security Analysts

DOWNLOAD
Author : Ivo Welch
language : en
Publisher:
Release Date : 2001

Herding Among Security Analysts written by Ivo Welch and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2001 with categories.

The paper shows that the buy or sell recommendations of security analysts have a significant positive influence on the recommendations of the next two analysts. This influence can be traced to short-lived information in the most recent revisions. In contrast, the influence of the prevailing consensus is not stronger if the consensus accurately forecasts subsequent stock price movements. This indicates consensus herding consistent with models in which analysts herd based on little information. The consensus also has a stronger influence when market conditions are favorable. The resulting poorer information aggregation could cause bull markets to be intrinsically more quot;fragilequot; (e.g., Bikhchandani et al., J. Political Economy 100(5) (1992) 992-1026).

Herd Behavior In Financial Markets

DOWNLOAD
Author : Sushil Bikhchandani
language : en
Publisher:
Release Date : 2000

Herd Behavior In Financial Markets written by Sushil Bikhchandani and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2000 with Capital market categories.

Analyst Herding And Investor Protection

DOWNLOAD
Author : Alexander Gabriel Kerl
language : en
Publisher:
Release Date : 2018

Analyst Herding And Investor Protection written by Alexander Gabriel Kerl and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018 with categories.

Using a multi-national dataset, we investigate the herding behaviour of financial analysts. Our results across a range of different countries suggest that analysts consistently deviate from their true forecasts and issue earnings forecasts that are biased by anti-herding. Furthermore, the level of bias (i.e. anti-herding) seems to be systematically higher for forecasts on companies from European countries compared to the US or Japan. We argue that such differences might stem from diverse levels of investor protection and corporate governance as analysts deviate less from true forecasts when the overall information environment is more transparent and company disclosures are of higher quality. Thereby, we proxy investor protection based on the company-level share of institutional ownership as well as country-level investor protection measures. Our results show that increasing levels of investor protection and corporate governance mitigate the anti-herding behaviour. Especially, when companies that are located in high investor protection countries are held by an increasing number of institutional investors, analysts are most reluctant to issue biased forecasts.

Bold Analysts Or Bold Banks

DOWNLOAD
Author : Reto Cueni
language : en
Publisher:
Release Date : 2013

Bold Analysts Or Bold Banks written by Reto Cueni and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013 with categories.

This paper examines the influence of institutional factors on the herding behavior of security analysts. Exploiting a unique dataset on the ownership of brokerage houses, we find that analysts from publicly listed brokers are more likely to issue herding forecasts compared to analysts from privately held brokers. We show that this effect is driven by the group of analysts covering financial sector stocks. In particular, the probability of issuing a herding forecast revision is 4% higher (average marginal effect) for financial sector analysts from public brokers compared to financial sector analysts from private brokers. We interpret this finding as evidence that financial sector analysts from public brokers are less independent, as their forecasts exert an externality on their broker's stock valuation.

An Empirical Evaluation Of Analysts Herding Behavior Following Regulation Fair Disclosure

DOWNLOAD
Author : Yaw M. Mensah
language : en
Publisher:
Release Date : 2007

An Empirical Evaluation Of Analysts Herding Behavior Following Regulation Fair Disclosure written by Yaw M. Mensah and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.

This study examines whether analysts' forecast revisions exhibited increased herding behavior following the adoption of Regulation Fair Disclosure. A recent model by Arya, Mittendorf, and Narayanamoorthy (2005) projects that one potential consequence of Regulation Fair Disclosure might be increased herding by financial analysts, although previous studies examining the economic consequences of Regulation FD have not found any averse consequence for investors. We examine financial analysts forecasting behavior before and after the adoption of Regulation FD in order to test the Arya et al. model. Our general finding is that increased herding behavior cannot be detected among either the firms most directly impacted by Regulation FD (those which used to hold closed press conferences), or those least affected (firms that used to hold open press conferences or did not hold them).