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- Publisher Website: 10.1287/mnsc.2023.4699
- WOS: WOS:000947384700001
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Article: Do Differences in Analyst Quality Matter for Investors Relying on Consensus Information?
Title | Do Differences in Analyst Quality Matter for Investors Relying on Consensus Information? |
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Authors | |
Issue Date | 1-Mar-2023 |
Publisher | Institute for Operations Research and Management Sciences |
Citation | Management Science, 2023 How to Cite? |
Abstract | This study investigates whether investors can reap economic benefits from analyzing differences in analyst quality. Although high-quality analysts’ average forecast is more accurate than the consensus forecast for firms with a large analyst following, the benefits of using high-quality analysts’ average forecasts are not economically significant. In contrast, the value of analyst quality differentiation exists in the second moment of forecasts. High-quality analysts’ forecast dispersion gives investors an advantage in dealing with uncertainty by predicting return volatility and providing opportunities for economically significant returns using option straddle and post-earnings announcement drift investment strategies. |
Persistent Identifier | http://hdl.handle.net/10722/328337 |
ISSN | 2023 Impact Factor: 4.6 2023 SCImago Journal Rankings: 5.438 |
ISI Accession Number ID |
DC Field | Value | Language |
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dc.contributor.author | Michaely, R | - |
dc.contributor.author | Rubin, A | - |
dc.contributor.author | Segal, D | - |
dc.contributor.author | Vedrashko, A | - |
dc.date.accessioned | 2023-06-28T04:42:35Z | - |
dc.date.available | 2023-06-28T04:42:35Z | - |
dc.date.issued | 2023-03-01 | - |
dc.identifier.citation | Management Science, 2023 | - |
dc.identifier.issn | 0025-1909 | - |
dc.identifier.uri | http://hdl.handle.net/10722/328337 | - |
dc.description.abstract | This study investigates whether investors can reap economic benefits from analyzing differences in analyst quality. Although high-quality analysts’ average forecast is more accurate than the consensus forecast for firms with a large analyst following, the benefits of using high-quality analysts’ average forecasts are not economically significant. In contrast, the value of analyst quality differentiation exists in the second moment of forecasts. High-quality analysts’ forecast dispersion gives investors an advantage in dealing with uncertainty by predicting return volatility and providing opportunities for economically significant returns using option straddle and post-earnings announcement drift investment strategies. | - |
dc.language | eng | - |
dc.publisher | Institute for Operations Research and Management Sciences | - |
dc.relation.ispartof | Management Science | - |
dc.title | Do Differences in Analyst Quality Matter for Investors Relying on Consensus Information? | - |
dc.type | Article | - |
dc.identifier.doi | 10.1287/mnsc.2023.4699 | - |
dc.identifier.hkuros | 344707 | - |
dc.identifier.eissn | 1526-5501 | - |
dc.identifier.isi | WOS:000947384700001 | - |
dc.identifier.issnl | 0025-1909 | - |