Superficial habits: Influence and predictive value of Seeking Alpha articles
54 Pages Posted: 5 May 2022 Last revised: 5 Oct 2023
Date Written: October 5, 2023
Abstract
We show that recommendations issued by Seeking Alpha authors can affect trading activity substantially. A recommendation’s chances to become influential in this sense are larger for more accessible articles and depend on characteristics which are observable without reading the text. One potential explanation of this finding is that Seeking Alpha community members are reluctant to spend much effort reading full articles and instead use superficial criteria to decide which articles to follow. Article features that are consistent with a detailed, in-depth analysis provide more valuable long-term investment advice. However, such articles appear to gather less interest from readers. We provide tentative evidence for profitable investment strategies based on those article features.
Keywords: Analysts, Seeking Alpha, Social Media, Investment Research
JEL Classification: G14, G17, G41
Suggested Citation: Suggested Citation