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Institutional Investors Investment Horizon and Analysts Target Price Accuracy
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- Authors
- Advisor
- 백복현
- Major
- 경영대학 경영학과
- Issue Date
- 2016-02
- Publisher
- 서울대학교 대학원
- Keywords
- 기관투자자 ; 애널리스트 목표주가
- Description
- 학위논문 (석사)-- 서울대학교 대학원 : 경영학과, 2016. 2. 백복현.
- Abstract
- This paper investigates whether the investment horizon of institutional investors influences sell-side analysts target price (TP) accuracy. Especially, I examine whether a sell-side analyst compromises TP accuracy on a stock if the stock is held by short-term institutional investors since those investors are sensitive to near-term price impact from TP issuances and, therefore, are more likely to exert pressures on analysts to keep the stock price high. Using a database of analysts TPs issued from 1999 to 2013, I find that TP error increases as transient institutional investors ownership increases, but not with the holdings of long-term institutional investors. The market partly appreciates the optimistic biases in the analysts TP revisions, reacting less favorably to a revision if the revision is preceded by the purchase of short-term institutional investors. However, the market overreacts in general and corrects itself in subsequent months. Overall, empirical results indicate that sell-side analysts and the market identify the heterogeneity of institutional investors and react selectively according to institutional investors investment horizons.
- Language
- English
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