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Investor Inattention and Under-Reaction to Repurchase Announcements.

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Title: Investor Inattention and Under-Reaction to Repurchase Announcements.
Authors: Cheng, Lee-Young (AUTHOR), Yan, Zhipeng (AUTHOR), Zhao, Yan (AUTHOR), Gao, Li-Ming (AUTHOR)
Source: Journal of Behavioral Finance. Jul-Sep2015, Vol. 16 Issue 3, p267-277. 11p.
Subjects: Investors, Announcements, Stock prices, Stock repurchasing, Organizational performance
Abstract: This paper investigates investor inattention as a plausible explanation for market reaction to repurchase announcements. We use prior turnover as the proxy for investor attention to examine the difference in stock price performance between low-attention stocks and high-attention stocks. We find that low prior turnover firms experience greater underreaction to repurchase announcements than high prior turnover firms. Low prior turnover firms also experience larger positive long-run excess returns following announcements. Furthermore, a higher level of investor's inattention leads to higher degree of underreactions, resulting in higher actual completion rates. JEL Classifications: G14, G15 [ABSTRACT FROM AUTHOR]
Copyright of Journal of Behavioral Finance is the property of Taylor & Francis Ltd and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)
Database: Psychology and Behavioral Sciences Collection
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PubType: Academic Journal
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Items – Name: Title
  Label: Title
  Group: Ti
  Data: Investor Inattention and Under-Reaction to Repurchase Announcements.
– Name: Author
  Label: Authors
  Group: Au
  Data: <searchLink fieldCode="AR" term="%22Cheng%2C+Lee-Young%22">Cheng, Lee-Young</searchLink> (AUTHOR)<br /><searchLink fieldCode="AR" term="%22Yan%2C+Zhipeng%22">Yan, Zhipeng</searchLink> (AUTHOR)<br /><searchLink fieldCode="AR" term="%22Zhao%2C+Yan%22">Zhao, Yan</searchLink> (AUTHOR)<br /><searchLink fieldCode="AR" term="%22Gao%2C+Li-Ming%22">Gao, Li-Ming</searchLink> (AUTHOR)
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  Data: <searchLink fieldCode="JN" term="%22Journal+of+Behavioral+Finance%22">Journal of Behavioral Finance</searchLink>. Jul-Sep2015, Vol. 16 Issue 3, p267-277. 11p.
– Name: Subject
  Label: Subjects
  Group: Su
  Data: <searchLink fieldCode="DE" term="%22Investors%22">Investors</searchLink><br /><searchLink fieldCode="DE" term="%22Announcements%22">Announcements</searchLink><br /><searchLink fieldCode="DE" term="%22Stock+prices%22">Stock prices</searchLink><br /><searchLink fieldCode="DE" term="%22Stock+repurchasing%22">Stock repurchasing</searchLink><br /><searchLink fieldCode="DE" term="%22Organizational+performance%22">Organizational performance</searchLink>
– Name: Abstract
  Label: Abstract
  Group: Ab
  Data: This paper investigates investor inattention as a plausible explanation for market reaction to repurchase announcements. We use prior turnover as the proxy for investor attention to examine the difference in stock price performance between low-attention stocks and high-attention stocks. We find that low prior turnover firms experience greater underreaction to repurchase announcements than high prior turnover firms. Low prior turnover firms also experience larger positive long-run excess returns following announcements. Furthermore, a higher level of investor's inattention leads to higher degree of underreactions, resulting in higher actual completion rates. JEL Classifications: G14, G15 [ABSTRACT FROM AUTHOR]
– Name: AbstractSuppliedCopyright
  Label:
  Group: Ab
  Data: <i>Copyright of Journal of Behavioral Finance is the property of Taylor & Francis Ltd and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract.</i> (Copyright applies to all Abstracts.)
PLink https://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=pbh&AN=109137169
RecordInfo BibRecord:
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    Identifiers:
      – Type: doi
        Value: 10.1080/15427560.2015.1065264
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      – Code: eng
        Text: English
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        PageCount: 11
        StartPage: 267
    Subjects:
      – SubjectFull: Investors
        Type: general
      – SubjectFull: Announcements
        Type: general
      – SubjectFull: Stock prices
        Type: general
      – SubjectFull: Stock repurchasing
        Type: general
      – SubjectFull: Organizational performance
        Type: general
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      – TitleFull: Investor Inattention and Under-Reaction to Repurchase Announcements.
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            NameFull: Cheng, Lee-Young
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            NameFull: Yan, Zhipeng
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            NameFull: Zhao, Yan
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            NameFull: Gao, Li-Ming
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            – D: 01
              M: 07
              Text: Jul-Sep2015
              Type: published
              Y: 2015
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              Value: 16
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          Titles:
            – TitleFull: Journal of Behavioral Finance
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