Sell-side analysts and mutual fund managers: Complements or substitutes?

IF 3.6 2区经济学 Q1 BUSINESS, FINANCE

Journal of Banking & Finance Pub Date : 2025-04-09 DOI:10.1016/j.jbankfin.2025.107446

Haerang Park , Byungmin Oh

引用次数: 0

Abstract

We examine whether analyst coverage and mutual fund trades are complements or substitutes in the course of information incorporation into stock prices. Our empirical evidence indicates that they are complementary. Clustered trades in stocks with low analyst coverage is associated with a subsequent return reversal, which is more pronounced among less actively managed mutual funds. Mutual fund herding under low analyst coverage also amplifies future stock price crash risk through decreased corporate disclosure quality. These negative effects of mutual fund herding are not apparent for stocks with high analyst coverage. To address potential endogeneity concerns, we conduct additional tests using brokerage firm mergers and closures as exogenous shocks to analyst coverage and find consistent results. Our findings highlight the role of analysts in mitigating price-destabilizing herding behavior of mutual funds.

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卖方分析师和共同基金经理：互补还是替代？

我们考察了分析师覆盖率和共同基金交易在信息纳入股票价格的过程中是互补还是替代。我们的经验证据表明，它们是互补的。分析师关注程度较低的股票的集中交易与随后的回报逆转有关，这在管理不那么积极的共同基金中更为明显。在低分析师覆盖率的情况下，共同基金趋之若趋也会通过降低公司信息披露质量，放大未来股价崩盘的风险。这些共同基金羊群效应的负面影响对于分析师覆盖率高的股票并不明显。为了解决潜在的内生性问题，我们进行了额外的测试，使用经纪公司合并和关闭作为分析师覆盖率的外生冲击，并找到一致的结果。我们的研究结果强调了分析师在缓解共同基金价格不稳定的羊群行为中的作用。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of Banking & Finance Multiple-

CiteScore

6.40

自引率

5.40%

发文量

262

期刊介绍： The Journal of Banking and Finance (JBF) publishes theoretical and empirical research papers spanning all the major research fields in finance and banking. The aim of the Journal of Banking and Finance is to provide an outlet for the increasing flow of scholarly research concerning financial institutions and the money and capital markets within which they function. The Journal''s emphasis is on theoretical developments and their implementation, empirical, applied, and policy-oriented research in banking and other domestic and international financial institutions and markets. The Journal''s purpose is to improve communications between, and within, the academic and other research communities and policymakers and operational decision makers at financial institutions - private and public, national and international, and their regulators. The Journal is one of the largest Finance journals, with approximately 1500 new submissions per year, mainly in the following areas: Asset Management; Asset Pricing; Banking (Efficiency, Regulation, Risk Management, Solvency); Behavioural Finance; Capital Structure; Corporate Finance; Corporate Governance; Derivative Pricing and Hedging; Distribution Forecasting with Financial Applications; Entrepreneurial Finance; Empirical Finance; Financial Economics; Financial Markets (Alternative, Bonds, Currency, Commodity, Derivatives, Equity, Energy, Real Estate); FinTech; Fund Management; General Equilibrium Models; High-Frequency Trading; Intermediation; International Finance; Hedge Funds; Investments; Liquidity; Market Efficiency; Market Microstructure; Mergers and Acquisitions; Networks; Performance Analysis; Political Risk; Portfolio Optimization; Regulation of Financial Markets and Institutions; Risk Management and Analysis; Systemic Risk; Term Structure Models; Venture Capital.