Abstract:We study sell‐side analysts’ motives to diversify their portfolios across industries. Despite the negative association between diversification and accuracy, more than 60% of analysts cover multiple industries. We argue that analysts’ choice to diversify is rooted in concerns about future job security. We find that more diversified analysts are less likely to experience job turnover and leave the profession but are not more likely to advance their careers. For experienced and all‐star analysts, diversification … Show more
Set email alert for when this publication receives citations?
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.