Analyst Bias and Mispricing
In: 7th Miami Behavioral Finance Conference 2016
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In: 7th Miami Behavioral Finance Conference 2016
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In: Contemporary Accounting Research, Forthcoming
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In: The journal of financial research: the journal of the Southern Finance Association and the Southwestern Finance Association, Band 20, Heft 2, S. 263-273
ISSN: 1475-6803
AbstractIn this paper we examine the relation between analysts' overoptimism and uncertainty as proxied by the standard deviation of earnings forecasts. We find a positive relation between overoptimism and uncertainty, but very little or no optimism when uncertainty is low. If the uncertainty surrounding a firm is high, analysts have fewer reputational concerns when they act on their inclinations to issue optimistic forecasts. Portfolio strategies based on these findings generate abnormal returns. The results suggest that greater prior uncertainty leads to higher analyst optimism, which in turn causes market overvaluation and profitable portfolio strategies.
In: Studies in family planning: a publication of the Population Council, Band 7, Heft 11, S. 322
ISSN: 1728-4465
In: The quarterly review of economics and finance, Band 49, Heft 2, S. 398-416
ISSN: 1062-9769
In: Journal for studies in economics and econometrics: SEE, Band 42, Heft 1, S. 1-22
ISSN: 0379-6205
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In: University of St.Gallen, School of Finance Research Paper No. 2019/11
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In: Huan Cai, Tong Yao & Xiaodi Zhang (2022): Confirmation Bias in Analysts' Response to Consensus Forecasts, Journal of Behavioral Finance, DOI: 10.1080/15427560.2022.2138395
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