CEO spin and the stock price crash

IF 6.9 2区 经济学 Q1 BUSINESS, FINANCE
Bin Liu , Xuemei Zhou
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引用次数: 0

Abstract

This study develops a model elucidating the mechanism by which CEO exaggeration triggers stock price collapses. CEOs leverage private information to attract investment through premarket boasting. Two investor archetypes interpret this information differently: Type I investors, possessing superior analytical capabilities, accurately discern true value; Type II investors, who rely on CEO pronouncements, may overestimate firm worth. Equilibrium prices depend on stock payoff, CEO boasting, and market liquidity. The model demonstrates that equilibrium prices exhibit a nonlinear dependence on the extent to which investors focus on CEO boasting, potentially culminating in a stock price collapse.
CEO忽悠和股价暴跌
本研究建立了一个模型来解释CEO夸大行为引发股价暴跌的机制。ceo们利用私人信息,通过上市前的吹嘘来吸引投资。两种投资者原型对这些信息的解释不同:I型投资者,具有卓越的分析能力,准确地辨别出真正的价值;依赖CEO声明的第二类投资者可能高估了公司价值。均衡价格取决于股票收益、CEO吹嘘和市场流动性。该模型表明,均衡价格表现出非线性依赖于投资者对CEO吹嘘的关注程度,这可能导致股价暴跌。
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来源期刊
Finance Research Letters
Finance Research Letters BUSINESS, FINANCE-
CiteScore
11.10
自引率
14.40%
发文量
863
期刊介绍: Finance Research Letters welcomes submissions across all areas of finance, aiming for rapid publication of significant new findings. The journal particularly encourages papers that provide insight into the replicability of established results, examine the cross-national applicability of previous findings, challenge existing methodologies, or demonstrate methodological contingencies. Papers are invited in the following areas: Actuarial studies Alternative investments Asset Pricing Bankruptcy and liquidation Banks and other Depository Institutions Behavioral and experimental finance Bibliometric and Scientometric studies of finance Capital budgeting and corporate investment Capital markets and accounting Capital structure and payout policy Commodities Contagion, crises and interdependence Corporate governance Credit and fixed income markets and instruments Derivatives Emerging markets Energy Finance and Energy Markets Financial Econometrics Financial History Financial intermediation and money markets Financial markets and marketplaces Financial Mathematics and Econophysics Financial Regulation and Law Forecasting Frontier market studies International Finance Market efficiency, event studies Mergers, acquisitions and the market for corporate control Micro Finance Institutions Microstructure Non-bank Financial Institutions Personal Finance Portfolio choice and investing Real estate finance and investing Risk SME, Family and Entrepreneurial Finance
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