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- Publisher Website: 10.1093/rfs/hhac024
- WOS: WOS:000813092500001
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Article: Cybersecurity Risk
| Title | Cybersecurity Risk |
|---|---|
| Authors | |
| Issue Date | 2022 |
| Citation | The Review of Financial Studies, 2022, Forthcoming How to Cite? |
| Abstract | Based on textual analysis and a comparison of cybersecurity risk disclosures of firms that were hacked to others that were not, we propose a novel firm-level measure of cybersecurity risk for all U.S.-listed firms. We then examine whether cybersecurity risk is priced in the cross-section of stock returns. Portfolios of firms with high exposure to cybersecurity risk outperform other firms, on average, by up to 8.3% per year. Yet, high-exposure firms perform poorly in periods of high cybersecurity risk. Reassuringly, the measure is higher in information-technology industries, correlates with characteristics linked to firms hit by cyberattacks, and predicts future cyberattacks. |
| Persistent Identifier | http://hdl.handle.net/10722/313200 |
| ISI Accession Number ID |
| DC Field | Value | Language |
|---|---|---|
| dc.contributor.author | Florackis, C | - |
| dc.contributor.author | Louca, C | - |
| dc.contributor.author | Michaely, R | - |
| dc.contributor.author | Weber, M | - |
| dc.date.accessioned | 2022-06-06T05:47:31Z | - |
| dc.date.available | 2022-06-06T05:47:31Z | - |
| dc.date.issued | 2022 | - |
| dc.identifier.citation | The Review of Financial Studies, 2022, Forthcoming | - |
| dc.identifier.uri | http://hdl.handle.net/10722/313200 | - |
| dc.description.abstract | Based on textual analysis and a comparison of cybersecurity risk disclosures of firms that were hacked to others that were not, we propose a novel firm-level measure of cybersecurity risk for all U.S.-listed firms. We then examine whether cybersecurity risk is priced in the cross-section of stock returns. Portfolios of firms with high exposure to cybersecurity risk outperform other firms, on average, by up to 8.3% per year. Yet, high-exposure firms perform poorly in periods of high cybersecurity risk. Reassuringly, the measure is higher in information-technology industries, correlates with characteristics linked to firms hit by cyberattacks, and predicts future cyberattacks. | - |
| dc.language | eng | - |
| dc.relation.ispartof | The Review of Financial Studies | - |
| dc.title | Cybersecurity Risk | - |
| dc.type | Article | - |
| dc.identifier.email | Michaely, R: ronim@hku.hk | - |
| dc.identifier.doi | 10.1093/rfs/hhac024 | - |
| dc.identifier.hkuros | 333204 | - |
| dc.identifier.volume | Forthcoming | - |
| dc.identifier.isi | WOS:000813092500001 | - |