The Impact of Increased Voluntary Disclosure on Market Information Asymmetry, Informed and Uninformed Trading

Cheng, Eugene C.M.; Courtenay, Stephen M.; Krishnamurti, Chandrasekhar

doi:10.1016/s1815-5669(10)70016-3

Cited by 23 publications

(22 citation statements)

References 62 publications

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“…The magnitude of the reported adjusted R² of 91% compares favourably with studies such as Gajewski and Li (2015) reporting an adjusted R² of 60%, Welker (1995) 63%, Ajina et al (2015) 74%, Leuz andVerrechia (2000) 81%, andCheng et al (2006) 85%.…”

Section: Bid-ask Spreadmentioning

confidence: 60%

“…As the p-values in Table 6 indicate, none of these hypotheses were rejected. All three Ho hypotheses were Cheng et al (2006) and Gajewski and Li (2015). The ordinary least square regression model is therefore used in all further analyses discussed in the remainder of this article.…”

Section: Resultsmentioning

confidence: 99%

“…Cheng et al 2006;Orens et al 2010) and share price volatility (e.g. Cheng et al 2006;Leuz & Verrechia 2000) are sometimes used as information asymmetry proxies and were tested as such in this study, the results thereof are not reported due to inherent limitations in the research design (e.g.…”

Section: Price Impactmentioning

confidence: 99%

“…The majority of related studies to date have either used an indirect disclosure proxy (i.e., a proxy that is not based on an examination of the original disclosure vehicle), for example, analyst ratings issued by the Association for Investment Management and Research (Botosan & Plumlee 2002;Brown & Hillegeist 2007), or based on an examination of the annual report (Ajina et al 2015;Cheng, Courtenay & Krishnamurti 2006;De La Bruslerie & Gabteni 2011). Studies that entail an examination of the original disclosure vehicle (e.g.…”

Section: Introductionmentioning

confidence: 99%

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The link between Internet investor relations and information asymmetry

Nel

Smit

Brümmer

2018

SAJEMS

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Background: Information asymmetry manifests when one party has more or better information than the other. Information asymmetry is said not only to increase transaction costs and decrease liquidity, but also to diminish the quality of the investment decisions taken by investors, thus weakening the overall functioning of markets. Aim and setting: A well-developed Internet investor relations (IIR) strategy, coupled with increased disclosure levels, should theoretically decrease information asymmetry levels. The majority of related studies to date used either an indirect disclosure proxy or involved an examination of the annual report, and have used data from United States or European companies. Empirical studies to date have produced mixed results. The aim of this study was to ascertain whether a relationship exists between the quality of IIR (via corporate websites) and information asymmetry. Method: This study used data from Johannesburg Stock Exchange (JSE)-listed companies. Multiple regression analysis was applied with information asymmetry as dependent variable and IIR as one of a set of selected explanatory variables. A self-constructed measurement instrument was used to measure IIR for a sample of 85 companies. Given the inherent difficulty with direct observation of information asymmetry, three different proxies were used to estimate information asymmetry. Results: A significant negative association was found between IIR and information asymmetry for all three information asymmetry proxies that were used: bid-ask spread, price impact, and analyst following. Conclusion: Empirical support is provided for the notion that companies may potentially benefit from a well-developed IIR strategy through reduced information asymmetry.

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Section: Bid-ask Spreadmentioning

confidence: 60%

Section: Resultsmentioning

confidence: 99%

Section: Price Impactmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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The link between Internet investor relations and information asymmetry

Nel

Smit

Brümmer

2018

SAJEMS

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“…To assess reliability, internal consistency was tested in two ways: by applying Cronbach's alpha and, in accordance with Froidevaux (2004), Cheng, Courtenay andKrishnamurti (2006), and Kelton and Yang (2008), by examining the correlation coefficients between disclosure categories. 9 For example, ownership that was discussed only in qualitative terms (e.g.…”

Section: Reliability and Validitymentioning

confidence: 99%

The development of a measurement instrument to measure the quality of internet investor relations

Nel

Brümmer

2016

SAJBM

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The purpose of this study was to develop a measurement instrument to measure the quality of Internet investor relations (IIR). This study will aid future research to examine IIR and provide guidance to companies in the development of an IIR strategy. The development of the instrument was based on best practice guidelines issued by the Investor Relations Society, an extensive literature review and a pilot study. The result was a measurement instrument that consists of 346 attributes.Quality is assessed by measuring content as widely as possible, by including attributes to measure the accessibility, navigation and timeliness of information, and by allowing for the measurement of attributes as being partially available based on breadth, usability and timeliness considerations. The reliability and validity of the measurement instrument was confirmed on the basis of the measurement results of a sample of 85 JSE-listed companies.

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The impact of corporate governance and political connections on information asymmetry: International evidence from banks in the Gulf Cooperation Council member countries

Tessema

2019

Journal of International Accounting, Auditing and Taxation

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The Impact of Increased Voluntary Disclosure on Market Information Asymmetry, Informed and Uninformed Trading

Cited by 23 publications

References 62 publications

The link between Internet investor relations and information asymmetry

The link between Internet investor relations and information asymmetry

The development of a measurement instrument to measure the quality of internet investor relations

The impact of corporate governance and political connections on information asymmetry: International evidence from banks in the Gulf Cooperation Council member countries

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