Please use this identifier to cite or link to this item: https://hdl.handle.net/10356/51234
Title: Are accurate bold forecasts better than accurate non-bold forecasts? Investors’ reactions to the joint effect of forecast boldness salience and forecast timing
Authors: Bo, Zhou
Keywords: DRNTU::Business::Accounting.
Issue Date: 2013
Source: Zhou, B. (2013). Are accurate bold forecasts better than accurate non-bold forecasts? : investors’ reactions to the joint effect of forecast boldness salience and forecast timing. Doctoral thesis, Nanyang Technological University, Singapore.
Abstract: In this study, I conduct an experiment to investigate how financial analysts‘ forecast boldness salience and forecast timing jointly influence investors‘ willingness to pay for investment advice, holding constant the accuracy of the forecast. I consider forecast boldness salience to refer to the extent that the magnitude of the analyst‘s forecast stands out from that made by others in terms of its boldness (magnitude of the forecast relative to the average forecast made by others) and uniqueness (whether there are other individual forecasts that are close or similar to this forecast). Forecast timing refers to whether analysts issue their forecasts earlier or later relative to other analysts. I find that for an early analyst, investors‘ willingness to pay for advice increases once his/her forecast is confirmed by the follower analyst(s). In contrast, for a late analyst, investors‘ willingness to pay for advice decreases if his/her forecast is non-bold. My results enrich our understanding on the joint effect of forecast characteristics on investor reaction to analysts‘ forecasts. I show that the effect of analysts‘ forecast boldness is contingent on both forecast uniqueness and forecast timing. My study has practical implications on forecasting strategies for financial analysts.
URI: https://hdl.handle.net/10356/51234
DOI: 10.32657/10356/51234
Fulltext Permission: open
Fulltext Availability: With Fulltext
Appears in Collections:NBS Theses

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