The Media and the Financial Markets: A Review

Raimondo, Carlo

doi:10.1111/ajfs.12250

Cited by 11 publications

(4 citation statements)

References 96 publications

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“…First, it is plausible that company executives will place greater emphasis on highlighting a firm's exploratory innovative activities in order to establish their reputation in the popular press as a 'pioneer' or 'radical innovator.' In the likely event that exploratory innovation activities will attract greater media coverage of both the firm and its key executives (Raimondo, 2019;Ahern & Sosyura, 2015), studies such as Nyugen (2015) and Kuhnen & Niessen (2012) suggest that corporate executives are likely to derive both monetary and other private benefits from this increased media attention. Therefore, consistent with the reporting obligations of publicly traded firms to disclose significant changes in their technological focus and/or operations in their regulatory filings, it is probable that firm managers will be more inclined to emphasize major changes in the technological focus of a firm's innovative activities in their press/10-K releases so as to educate investors on the success of the management team's long-term growth strategy.…”

Section: Introductionmentioning

confidence: 99%

Innovation Search Strategy and Predictable Returns

et al. 2021

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Because of the intangible and highly uncertain nature of innovation, investors may have difficulty processing information associated with a firm’s innovation search strategy. Due to cognitive and strategic biases, investors are likely to pay more attention to unfamiliar explorative patents rather than incremental exploitative patents. We find that innovative firms focusing on exploitation rather than exploration tend to generate superior subsequent short-term operating performance. Analysts do not seem to detect this, as firms currently focused on exploitation tend to outperform the market’s near-term earnings expectations. The stock market also seems unable to accurately incorporate information about a firm’s innovation search strategy. We find that firms with exploitation strategies are undervalued relative to firms with exploration strategies and that this return differential is incremental to standard risk and innovation-based pricing factors examined in the prior literature. This result suggests a more nuanced view on whether stock market pressure hampers innovation, and may have implications for optimal firm financing choices and corporate disclosure policy. This paper was accepted by David Simchi-Levi, finance.

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Section: Introductionmentioning

confidence: 99%

Innovation Search Strategy and Predictable Returns

et al. 2021

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“…In relation to the ECF market, we can state that up until now the technique of text sentiment analysis has not been applied to investor behavior. The use of natural language processing (NLP) has grown over recent years, especially in the area of finance according to Fisher et al (2016) and Raimondo (2019). According to these authors, NLP can be very useful in extracting information in accounting statements, media news items, and analyst predictions, among others.…”

Section: Text Sentiment Of News Items and Market Reactionsmentioning

confidence: 99%

Good News from Mass Media Induces More Investments in the Equity Crowdfunding Market

Felipe,

Mendes-da-Silva,

Ali

et al. 2023

BAR, Braz. Adm. Rev.

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The authors claim that they do not have authorization from the ECF platform to make the survey data available to the public. BAR -Brazilian Administration Review encourages data sharing but, in compliance with ethical principles, it does not demand the disclosure of any means of identifying research subjects.Plagiarism Check: BAR maintains the practice of submitting all documents received to the plagiarism check, using specific tools, e.g.: iThenticate.Peer review: is responsible for acknowledging an article's potential contribution to the frontiers of scholarly knowledge on business or public administration. The authors are the ultimate responsible for the consistency of the theoretical references, the accurate report of empirical data, the personal perspectives, and the use of copyrighted material. This content was evaluated using the double-blind peer review process. The disclosure of the reviewers' information on the first page is made only after concluding the evaluation process, and with the voluntary consent of the respective reviewers.

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“…This information helps investors estimate the value of a firm. Therefore, as Raimondo (2016) summarised, many researchers study various aspects of the effect of the media on the stock market.…”

Section: Event Studies and Message Boardmentioning

confidence: 99%