The Interplay Between Bond Analysts and Equity Analysts in Information Provision

50 Pages Posted: 7 Mar 2019

See all articles by Yufei Liu

Yufei Liu

Peking University, Guanghua School of Management, Department of Finance, Students

Ruichang Lu

Department of Finance, Guanghua School of Management, Peking University

Xiaojun Zhang

Peking University

Date Written: February 17, 2019

Abstract

We explore the interplay between sell-side bond analysts and equity analysts in information provision. We use plausibly exogenous variation in equity analyst coverage to show that bond analysts actively react to the reduction in equity analyst coverage by initiating coverage, issuing more reports, and issuing reports with more pages and larger sizes. Moreover, these reports also have a larger market impact. These effects are more pronounced for firms with less existing bond analyst coverage and firms with management earnings guidance. Overall, our results suggest that bond analysts can causally influence and shape firms’ information environment.

Keywords: Information Provision; Bond Analyst; Equity Analyst; Intermediaries’ Interplay; Information Environment

JEL Classification: G32, G34, M41

Suggested Citation

Liu, Yufei and Lu, Ruichang and Zhang, Xiaojun, The Interplay Between Bond Analysts and Equity Analysts in Information Provision (February 17, 2019). Available at SSRN: https://ssrn.com/abstract=3336189 or http://dx.doi.org/10.2139/ssrn.3336189

Yufei Liu

Peking University, Guanghua School of Management, Department of Finance, Students ( email )

Beijing
China

Ruichang Lu (Contact Author)

Department of Finance, Guanghua School of Management, Peking University ( email )

Beijing
China

Xiaojun Zhang

Peking University ( email )

No. 5 Yiheyuan Road
Haidian District
Beijing, Beijing 100871
China

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