On the Determinants of International Analyst Research Coverage

57 Pages Posted: 1 Aug 2003

See all articles by Omesh Kini

Omesh Kini

Georgia State University

Shehzad L. Mian

Emory University - Department of Finance

Michael J. Rebello

University of Texas at Dallas - Naveen Jindal School of Management

Anand Venkateswaran

Northeastern University - Finance and Insurance Area

Date Written: March 2003

Abstract

In this paper, we study economic forces and constraints that shape analyst research coverage along country and sector dimensions. Our results support the hypothesis that analyst portfolios are structured to capture economies of scale in information acquisition and production. Specifically, the likelihood of an analyst specializing by country increases as the importance of the country factor in explaining stock return variability rises. Similarly, the likelihood of specialization by sector increases as the sector factor strengthens. We also find that higher country equity market capitalization increases the likelihood of country specialization while a larger total equity market capitalization of a sector in a particular country (country-sector market capitalization) increases the likelihood that analysts cover firms in a single sector. Finally, institutional features that influence the cost and value of information production also impact analyst specialization.

Suggested Citation

Kini, Omesh and Mian, Shehzad L. and Rebello, Michael J. and Venkateswaran, Anand, On the Determinants of International Analyst Research Coverage (March 2003). EFA 2003 Annual Conference Paper No. 373, Available at SSRN: https://ssrn.com/abstract=424042 or http://dx.doi.org/10.2139/ssrn.424042

Omesh Kini (Contact Author)

Georgia State University ( email )

University Plaza
Atlanta, GA 30303-3083
United States
404-651-2656 (Phone)

Shehzad L. Mian

Emory University - Department of Finance ( email )

Atlanta, GA 30322-2710
United States
404-727-2755 (Phone)
404-727-6313 (Fax)

Michael J. Rebello

University of Texas at Dallas - Naveen Jindal School of Management ( email )

P.O. Box 830688
Richardson, TX 75083-0688
United States

Anand Venkateswaran

Northeastern University - Finance and Insurance Area ( email )

Boston, MA 02115
United States

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