Broker-Hosted Investor Conferences
T. Clifton Green
Emory University - Goizueta Business School
University of Kentucky
Southern Methodist University (SMU) - Edwin L. Cox School of Business
University of Maryland-College Park
May 30, 2014
Journal of Accounting & Economics (JAE), Forthcoming
We examine the determinants and consequences of broker-hosted investor conferences. We find the number of brokers hosting a firm at conferences is positively related to institutional ownership and intangible assets, consistent with greater client demand for management access among hard-to-value firms. Younger firms and those that issue equity in the future attend more conferences, suggesting firms view conference participation as a means to enhance investor recognition. Hosting brokers are rewarded with increased commission revenue. Commission share increases by 0.61% during the conference week, with larger increases following more informative conference disclosures. Firms also benefit from conference participation. In the subsequent year, conference firms are followed by an additional 0.34 analysts, undergo a 6% reduction in bid-ask spread, and experience a 0.03 increase in Tobin’s Q.
Number of Pages in PDF File: 59
Keywords: Analyst Research, Institutional Trading, Brokerage Commissions
JEL Classification: G14
Date posted: August 19, 2011 ; Last revised: June 24, 2014
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