Individual investors and financial disclosure

Journal of Accounting and Economics

Volumn 56, Issue 1, 2013, Pages 130-147

  Lawrence, Alastair ^a  

^a UNIVERSITY OF CALIFORNIA   (United States)

Author keywords

Financial disclosure; Individual characteristics; Individual investors; Information disadvantage

Indexed keywords

EID: 84879847651     PISSN: 01654101     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.jacceco.2013.05.001     Document Type: Article

References (64)

1. Barber B., Odean T. Trading is hazardous to your wealth: the common stock investment performance of individual investors. Journal of Finance 2000, 55:773-806.
2. Barber B., Odean T. Boys will be boys: gender, overconfidence, and common stock investment. Quarterly Journal of Economics 2001, 116:261-292.
3. Barber B., Odean T. All that glitters: the effect of attention and news on the buying behavior of individual and institutional investors. Review of Financial Studies 2008, 21:785-818.
4. Barber B., Odean T., Zhu Do retail trades move markets?. Review of Financial Studies 2009, 22:151-186.
5. Barron O., Kim O., Lim S., Stevens D. Using analysts' forecasts to measure properties of analysts' information environment. Accounting Review 1998, 73:421-433.
6. Beaver W. The information content of annual earnings announcements. Journal of Accounting Research 1968, 6:67-92.
7. Berger P., Hann R. Segment profitability and the proprietary and agency costs of disclosure. Accounting Review 2007, 82:869-906.
8. Bertsimas D., Lo A. Optimal control of execution costs. Journal of Financial Markets 1998, 1:1-50.
9. Bhattacharya N. Investors' trade size and trading responses around earnings announcements: an empirical investigation. Accounting Review 2001, 76:221-244.
10. Bhattacharya N., Black E., Christensen T., Mergenthaler R. Who trades on pro forma earnings information?. Accounting Review 2007, 82:581-619.
11. Bhushan R. An informational efficiency perspective on the post-earnings announcement drift. Journal of Accounting and Economics 1994, 18:45-65.
12. Bloomfield R. The "incomplete revelation hypothesis" and financial reporting. Accounting Horizons 2002, 16:233-243.
13. Briloff A. The Effectiveness of Accounting Communication 1967, Praeger, New York, NY.
14. Brüggemann, U., Daske, H., Homburg, C., Pope, P., 2012. How do individual investors react to hlobal IFRS adoption?. Working Paper, Humboldt University.
15. Bushee B., Noe C. Corporate disclosure practices, institutional investors, and stock return volatility. Journal of Accounting Research 2000, 38:171-202.
16. Bushee B., Matsumoto D., Miller G. Open versus closed conference calls: the determinants and effects of broadening access to disclosure. Journal of Accounting and Economics 2003, 34:149-180.
17. Bushee B., Matsumoto D., Miller G. Managerial and investor responses to disclosure regulation: the case of Reg FD and conference calls. Accounting Review 2004, 79:617-643.
18. Campbell J., Ramadorai T., Schwartz A. Caught on tape: institutional trading, stock returns, and earnings announcements. Journal of Financial Economics 2009, 92:66-91.
19. Carhart M. On persistence in mutual fund performance. Journal of Finance 1997, 52:57-82.
20. Cohen J., Holder-Webb L., Wood D., Nath L. Retail investors' perceptions of the decision-usefulness of economic performance, governance and corporate social responsibility disclosures. Behavioral Research in Accounting 2011, 23:109-129.
21. Covrig V., DeFond M., Hung M. Home bias, foreign mutual fund holdings, and the voluntary adoption of international accounting standards. Journal of Accounting Research 2007, 45:41-70.
22. De Franco G., Lu H., Vasvari F. Wealth transfer effects of analysts' misleading behavior. Journal of Accounting Research 2007, 45:71-110.
23. Deaves R., Dine C., Horton W. How are Investment Decisions Made? 2006, (Working Paper, Task Force to Modernize Securities Legislation in Canada).
24. Diamond D., Verrecchia R. Disclosure, liquidity, and the cost of capital. Journal of Finance 1991, 46:1325-1359.
25. Easley D., O'Hara M. Information and the cost of capital. Journal of Finance 2004, 59:1553-1583.
26. Elliott W.B., Hodge F., Jackson K. The association between nonprofessional investors' information choices and their portfolio returns: the importance of investing experience. Contemporary Accounting Research 2008, 25:473-498.
27. Fama E., French K. Common risk-factors in the returns on stocks and bonds. Journal of Financial Economics 1993, 33:3-56.
28. Financial Accounting Standards Board (FASB) Conceptual Framework for Financial Reporting-Chapter 1, The Objective of General Purpose Financial Reporting, and Chapter 3, Qualitative Characteristics of Useful Financial Information 2010, FASB, Norwalk, CT, (Statement of Financial Accounting Concepts No. 8).
29. Financial Accounting Standards Board (FASB) Invitation to Comment-Disclosure Framework 2012, FASB, Norwalk, CT.
30. Finucane T. A direct test of methods for inferring trade direction from intra-day data. Journal of Financial and Quantitative Analysis 2000, 35:553-576.
31. Francis J., Khurana I., Pereira R. Disclosure incentives and effects on cost of capital around the world. Accounting Review 2005, 80:1125-1162.
32. Frankel R, Li X. Characteristics of a firm's information environment and the information asymmetry between insiders and outsiders. Journal of Accounting and Economics 2004, 37:229-259.
33. Garfinkel J. Measuring investors' opinion divergence. Journal of Accounting Research 2009, 47:1317-1348.
34. Healy P., Hutton A., Palepu K. Stock performance and intermediation changes surrounding sustained increases in disclosure. Contemporary Accounting Research 1999, 16:485-520.
35. Hirshleifer D., Teoh S. Limited attention, information disclosure, and financial reporting. Journal of Accounting and Economics 2003, 36:337-386.
36. Hirshleifer D., Myers J., Myers L., Teoh S. Do individual investors cause post-earnings announcement drift? Direct evidence from personal trades. Accounting Review 2008, 83:1521-1550.
37. Hope O.-K. Disclosure practices, enforcement of accounting standards, and analysts' forecast accuracy: an international study. Journal of Accounting Research 2003, 41:235-272.
38. Hope O.-K., Thomas W. Managerial empire building and firm disclosure. Journal of Accounting Research 2008, 46:591-626.
39. Indjejikian R. The impact of costly information interpretation on firm disclosure decisions. Journal of Accounting Research 1991, 29:277-301.
40. International Accounting Standards Board (IASB) IASC Foundation and IASB Emphasise Greater Investor Participation in the Development of IFRSs 2010, (Press Release, April 29, 2010).
41. International Accounting Standards Committee (IASC) Framework for the Preparation and Presentation of Financial Statements 1989, IASC, London.
42. Ivković Z., Poterba J., Weisbenner S. Tax-motivated trading by individual investors. American Economic Review 2005, 95:1605-1630.
43. Kaniel R., Liu S., Saar G., Titman S. Individual investor trading and return patterns around earnings announcements. Journal of Finance 2012, 67:637-680.
44. Kim O., Verrecchia R. Market liquidity and volume around earnings announcements. Journal of Accounting and Economics 1994, 17:41-67.
45. Kumar A., Lee C. Retail investor sentiment and return comovements. Journal of Finance 2006, 61:2451-2486.
46. Kyle A. Continuous auctions and insider trading. Econometrica 1985, 53:1315-1335.
47. Lang M., Lundholm R. Corporate disclosure policy and analyst behavior. Accounting Review 1996, 71:467-492.
48. Larcker D., Rusticus T. On the use of instrumental variables in accounting research. Journal of Accounting and Economics 2010, 49:186-205.
49. Lee C. Earnings news and small traders: an intraday analysis. Journal of Accounting and Economics 1992, 15:265-302.
50. Lehavy R., Li F., Merkley K. The effect of annual report readability on analyst following and the properties of their earnings forecasts. Accounting Review 2011, 86:1087-1115.
51. Lerman A. Individual investors' attention to accounting information: message board discussions. Working Paper 2011, Yale University.
52. Leuz C., Verrecchia R. The economic consequences of increased disclosure. Journal of Accounting Research 2000, 38:91-124.
53. Lewis M. The Big Short: Inside the Doomsday Machine 2010, W.W. Norton and Company, New York, NY.
54. Li F. Annual report readability, current earnings, and earnings persistence. Journal of Accounting and Economics 2008, 45:221-247.
55. Merton R. A simple model of capital market equilibrium with incomplete information. Journal of Finance 1987, 42:483-510.
56. Miller B. The effects of reporting complexity on small and large investor trading. Accounting Review 2010, 85:2107-2144.
57. Odders-White E. On the occurrence and consequences of inaccurate trade classification. Journal of Financial Markets 2000, 3:259-286.
58. Rennekamp K. Processing fluency and investors' reactions to disclosure readability. Journal of Accounting Research 2012, 50:1319-1354.
59. Securities and Exchange Commission (SEC), 2006. Electronic Filing and the EDGAR System: A Regulatory Overview. Available at: (October 3). http://www.sec.gov/info/edgar/regoverview.htm.
60. Securities and Exchange Commission (SEC), 2007. Speech by SEC Staff: Feedback From Individual Investors on Disclosure. Available at: (January 19). http://www.sec.gov/news/speech/2007/spch011907ljs.htm.
61. Securities and Exchange Commission (SEC) Announcement From the SEC Investor Advisory Committee 2009, (Press Release, July 29, 2009).
62. Securities and Exchange Commission (SEC), 2013. The Investor's Advocate: How the SEC Protects Investors, Maintains Market Integrity, and Facilitates Capital Formation. Available at:. http://www.sec.gov/about/whatwedo.shtml.
63. Taylor D. Retail Investors and the Adjustment of Stock Prices to Earnings Information 2011, University of Pennsylvania, (Working Paper).
64. Welker M. Disclosure policy, information asymmetry and liquidity in equity markets. Contemporary Accounting Research 1995, 11:801-827.