Did Regulation Fair Disclosure Level the Playing Field? Evidence from an Analysis of Changes in Trading Volume and Stock Price Reactions to Earnings Announcements
Title | Did Regulation Fair Disclosure Level the Playing Field? Evidence from an Analysis of Changes in Trading Volume and Stock Price Reactions to Earnings Announcements PDF eBook |
Author | Anwer S. Ahmed |
Publisher | |
Pages | 40 |
Release | 2004 |
Genre | |
ISBN |
We contribute to the literature on Regulation Fair Disclosure (FD) in three ways. First, we provide evidence on whether FD has achieved its intended effect of leveling the information playing field by examining whether differences across investors' information quality prior to earnings announcements have declined after the pronouncement of the regulation. We find strong evidence of a decline in earnings announcement period trading volume attributable to differential prior precision after FD consistent with a more level playing field. Second, we re-examine whether FD has resulted in firms reducing or chilling their information flows (disclosures) to investors. Contrary to prior work, we find that there is evidence of an overall reduction or chill in information flows after FD relative to a quot;cleanerquot; pre-FD period than the pre-FD period used in other studies. Third, we document that while the leveling effect of FD is relatively wide-spread, the chill effect is driven by (i) relatively smaller, high technology firms and (ii) relatively larger firms with high book-to-market ratios. We interpret the latter result as evidence that firms with relatively high costs of public disclosure chose to eliminate the disclosure altogether rather than broadening access to the disclosure.
The Impact of Regulation Fair Disclosure on Investors' Prior Information Quality - Evidence from an Analysis of Changes in Trading Volume and Stock Price Reactions to Earnings Announcements
Title | The Impact of Regulation Fair Disclosure on Investors' Prior Information Quality - Evidence from an Analysis of Changes in Trading Volume and Stock Price Reactions to Earnings Announcements PDF eBook |
Author | Anwer S. Ahmed |
Publisher | |
Pages | |
Release | 2007 |
Genre | |
ISBN |
We document that Regulation Fair Disclosure has reduced differences in information quality between investors prior to quarterly earnings announcements consistent with the intent of the regulation. This reduction is driven by small firms and high technology firms, rather than the large firms targeted by the SEC, which suggests that selective disclosure among large firms may have been much more limited than what was presumed by proponents of FD. In addition, we document that FD has decreased the average information quality of investors in small and high technology firms in the period prior to an earnings announcement while having no lasting effect on other firms. Taken together these two results suggest that, for small and high technology firms, FD succeeded in eliminating selective disclosure but also lowered the average quality of information available about these firms.
America's Capital Markets
Title | America's Capital Markets PDF eBook |
Author | United States. Congress. House. Committee on Financial Services. Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises |
Publisher | |
Pages | 292 |
Release | 2006 |
Genre | Business & Economics |
ISBN |
U.C. Davis Law Review
Title | U.C. Davis Law Review PDF eBook |
Author | University of California, Davis. School of Law |
Publisher | |
Pages | 1394 |
Release | 2005-11 |
Genre | Law |
ISBN |
Regulation Fair Disclosure and Earnings Information
Title | Regulation Fair Disclosure and Earnings Information PDF eBook |
Author | Warren Bailey |
Publisher | |
Pages | 50 |
Release | 2014 |
Genre | |
ISBN |
With the adoption of Regulation Fair Disclosure (Reg FD), market behavior around earnings releases displays no significant change in return volatility (after controlling for decimalization of stock trading) but significant increases in trading volume due to difference in opinion. Analyst forecast dispersion increases, and increases in other measures of disagreement and difference of opinion suggest greater difficulty in forming forecasts beyond the current quarter. Corporations increase the quantity of voluntary disclosures, but only for current quarter earnings. Thus, Reg FD seems to increase the quantity of information available to the public while demanding more effort and struggle from investment professionals.
Model Rules of Professional Conduct
Title | Model Rules of Professional Conduct PDF eBook |
Author | American Bar Association. House of Delegates |
Publisher | American Bar Association |
Pages | 216 |
Release | 2007 |
Genre | Law |
ISBN | 9781590318737 |
The Model Rules of Professional Conduct provides an up-to-date resource for information on legal ethics. Federal, state and local courts in all jurisdictions look to the Rules for guidance in solving lawyer malpractice cases, disciplinary actions, disqualification issues, sanctions questions and much more. In this volume, black-letter Rules of Professional Conduct are followed by numbered Comments that explain each Rule's purpose and provide suggestions for its practical application. The Rules will help you identify proper conduct in a variety of given situations, review those instances where discretionary action is possible, and define the nature of the relationship between you and your clients, colleagues and the courts.
Dissertation Abstracts International
Title | Dissertation Abstracts International PDF eBook |
Author | |
Publisher | |
Pages | 580 |
Release | 2004 |
Genre | Dissertations, Academic |
ISBN |
Abstracts of dissertations available on microfilm or as xerographic reproductions.