Investor Conferences and Stock Liquidity
University of Missouri at Columbia - Robert J. Trulaske, Sr. College of Business
September 15, 2014
Nascent literature suggests that CEO time spent with outsiders is less beneficial to the firm than time spent with insiders, yet firm executives spend increasingly more time every year meeting with investors at conferences. We examine improvement in stock liquidity as an economic benefit from presenting at conferences. We find that firms participating at conferences experience a 1.4% to 2.8% increase in stock liquidity compared to non-conference firms. The improvement in liquidity is higher for firms with low pre-conference visibility and varies predictably with conference characteristics that affect the degree to which investors can update their beliefs about the firm.
Number of Pages in PDF File: 58
Keywords: Conference Presentations, Liquidity Risk, Cost of Equity Capital
JEL Classification: G10, G14working papers series
Date posted: January 31, 2011 ; Last revised: September 17, 2014
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