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Different Types of Investor Reactions to Annual Reports

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  • Zhuwei Li
  • Baolu Wang
  • Yuan Fu
  • Yongdong Shi
  • Xuexin Su

Abstract

This study analyzes the different investor behaviors after the release of annual reports and their reactions to revenue information. Accordingly, we use a unique dataset of account information for all shareholders in China’s Shenzhen Stock Exchange. Our results indicate that individual investors are apt to increase their positions after the release of the annual report, whereas institutional investors do the opposite. Moreover, we determine that institutional investors tend to buy shareholdings after obtaining positive revenue information, whereas the behavior of individual investors is the opposite. We assume that their different degrees of overconfidence lead to different behaviors after the annual reports and revenue information are released. Evidently, individual investors are more overconfident than institutional investors.

Suggested Citation

  • Zhuwei Li & Baolu Wang & Yuan Fu & Yongdong Shi & Xuexin Su, 2020. "Different Types of Investor Reactions to Annual Reports," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 56(3), pages 626-640, February.
    • Handle: RePEc:mes:emfitr:v:56:y:2020:i:3:p:626-640
    DOI: 10.1080/1540496X.2018.1482744
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    Cited by:

    1. Xiao, Jucheng & He, Guangyu & Fan, Shuai & Li, Zuyi, 2022. "Substitute energy price market mechanism for renewable energy power system with generalized energy storage," Applied Energy, Elsevier, vol. 328(C).
    2. Lee, Ji Young & Lee, Hyun Ji & Masters, Allyson S. & Fletcher, Katelyn K. & Suh, Daniel D. & Golinkoff, Roberta M. & Hirsh-Pasek, Kathy, 2023. "Bringing playful learning to South Korea: An alternative pedagogical approach to promote children's learning and success," International Journal of Educational Development, Elsevier, vol. 97(C).
    3. Lu, Jing & Wang, Jun, 2021. "Corporate governance, law, culture, environmental performance and CSR disclosure: A global perspective," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 70(C).
    4. Vecchi, Alessandra & Brennan, Louis, 2022. "Two tales of internationalization – Chinese internet firms' expansion into the European market," Journal of Business Research, Elsevier, vol. 152(C), pages 106-127.
    5. Yu, Xiaojian & Liu, Jianlin & Lien, Donald, 2023. "A new measure of fund window dressing and its application to Chinese mutual fund market," The Quarterly Review of Economics and Finance, Elsevier, vol. 89(C), pages 63-72.

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