Investment managers' disclosures at investment conferences: Buzz vs. credibility

Abstract

Investment conferences offer rare buy-side disclosures, allowing star investment managers to discuss holdings and manage reputational capital amid competition for investors’ attention. I analyze 1,121 stock recommendations and 345 target prices from 95 events (2009–2018). Consistent with a credibility-enhancing role, stock recommendations yield persistent abnormal returns up to two years, with managers gradually reducing holdings. Consistent with a buzz-generating motive, target prices are highly biased and only predict short-term returns, especially before managers reduce their holdings. Managers with a history of biased forecasts or trading against their recommendations face reduced investors’ reactions and fewer conference invitations.

Keywords: Disclosures, Investment conferences, Investment managers, Reputation JEL Classification: G14 and G23

JEL Classification: G14, G23