Informed trading before analyst downgrades: Evidence from short sellers

By Stephen E. Christophe, Michael G. Ferri, J. J. Po-An Hsieh. 2010

410 citations recorded by the source corpus.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/3fcc5eafca4dc1d87b95b6307e8bdec27833944d

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. Xiaohua Fang
2. Jeffrey L. Callen
3. Matthew C. Ringgenberg
4. Adam V. Reed
5. Yuehua Tang
6. Gennaro Bernile
7. Massimo Massa
8. Joseph E. Engelberg

In Finance

1. Xiaohua Fang
2. Jeffrey L. Callen
3. Matthew C. Ringgenberg
4. Adam V. Reed
5. Joseph E. Engelberg
6. Yuehua Tang
7. Gennaro Bernile
8. Massimo Massa

Citations in the corpus

• How are shorts informed (2012, background): “Christophe, Ferri, and Angel (2004) and Christophe, Ferri, and Hsieh (2010) focus on short sellers’ trades around earnings announcements and analyst downgrades, respectively, and find evidence that short sellers are informed traders who can profit from these events.”
• Can Information Be Locked-Up? Informed Trading Ahead of Macro-News Announcements (2016, positive): “…appear to enjoy early access to information on analysts’ recommendations as result of “tipping” (e.g., Irvine, Lipson, and Puckett, (2007); Goldstein, Irvine, Kandel, and Wiener (2009); Christophe, Ferri, and Hsieh (2010); Busse, Green, and Jegadeesh (2012); Kadan, Michaely, and Moulton (2014)).”
• How are Shorts Informed? Short Sellers, News, and Information Processing (2012, positive): “Christophe, Ferri, and Angel (2004) and Christophe, Ferri, and Hsieh (2010) focus on short sellers’ trades around earnings announcements and analyst downgrades, respectively, and find evidence that short sellers are informed traders who can profit from these events.”
• Analysts’ Forecasts and Asset Pricing: A Survey (2016, neutral): “On the other hand, studies such as Irvine, Lipson, and Puckett (2007), Juergens and Linsey (2009), and Christophe, Ferri, and Hsieh (2010) suggest that analysts may also increase adverse selection risk among investors by sharing information privately with preferred clientele ahead of publicly…”
• Competition of the Informed: Does the Presence of Short Sellers Affect Insider Selling? (2015, background): “It is well-documented that short sellers are able to identify overvalued or “suspicious” stocks (e.g., Dechow et al., 2001; Christophe et al., 2004; Desai et al., 2006; Cohen et al., 2007, Christophe et al., 2010; Karpoff and Lou, 2010; Hirshleifer et al., 2011, Ljungqvist and Qian, 2014).”
• Short interest and stock price crash risk (2015, background): “8 Desai et al. (2006) and Karpoff and Lou (2010) acknowledge this issue.”