Financial Press Research Articles

Behavioral and Psychological Determinants of Cryptocurrency Investment: Expanding UTAUT with Perceived Enjoyment and Risk Factors

With their potential for high returns and expanding role in the financial landscape, cryptocurrency investments have garnered the attention of the financial press and investors. Applying an integrated research model based on the Unified Theory of Acceptance and Use of Technology (UTAUT), this study investigates the factors influencing individual investors’ attitudes toward cryptocurrency investments and their intention to continue investing. The model incorporates constructs such as performance expectancy, effort expectancy, social influence, perceived risk, perceived privacy, technology competency, perceived enjoyment, and prior experience. Data from 506 cryptocurrency investors located in the United States were collected through a 50-item questionnaire. The findings indicate that performance expectancy and perceived enjoyment positively impact attitudes toward cryptocurrency investments, which, in turn, influence the intention to continue investing. Perceived privacy positively affects performance expectancy, while technology competency enhances effort expectancy. These results offer valuable insights for policymakers and cryptocurrency exchanges to foster sustainable growth in the cryptocurrency market. Despite its contributions, the study acknowledges limitations, including a focus on current investors in the US and the exclusion of factors such as optimism and innovativeness. Future research should explore these aspects across different populations and regions to gain a more comprehensive understanding of cryptocurrency investment behavior.

The impact of mainstream financial press attention on stock pricing efficiency in the China stock market

AbstractAs the pivotal figure of information transmission in the capital market, the mainstream financial press has a significant impact on the operation of the stock market. Based on the mainstream financial press, this study obtains the news reports of 945 China A‐share listed companies in 2010–2019 and analyzes the relationship between the attention of the mainstream financial press and the efficiency of stock pricing. Further, we explore the mediating effect of corporate governance in this correlation. The empirical results show that the more reports on listed companies from the mainstream financial press the lower the delay level of the stock price of listed companies. At the same time, the characteristics information of the stock price increases, the higher the stock pricing efficiency. The attitude of press reports of listed companies also has an impact on the efficiency of stock pricing. The improvement of pricing efficiency will be achieved through neutral reporting. Mainstream financial press reports indirectly improve the efficiency of stock pricing by reducing the agency costs of the two types, and corporate governance plays a significant intermediary role in it. Finally, compared with market‐oriented media, the effect of policy‐oriented mainstream financial press on pricing efficiency is more significant.

The Greek crisis as a “morality tale”? An empirical assessment

Credit and debt are more than just material exchanges within a market economy, they are also social constructs embedded in moral judgments about the character of the agents involved. During the recent European Sovereign Bond crisis, some commentators noted how a similarly loaded moral media discourse juxtaposed “virtuous” Northern European countries on the one side, and “spendthrift, lazy” Southern European ones on the other side. In this article, I provide a quantitative large-N empirical assessment of this phenomenon. I employ a dictionary-based approach inspired by research in social psychology to measure moral content. Upon analyzing more than 14,000 articles published in the Anglo-American and German financial press between 2004 and 2019, I show the extent to which Greece was described in negative moral language. After the initial “shock” in the fall of 2009, the average moral tone turns negative, and more so in the German financial press relative to its Anglo-American counterpart. Moreover, by most measures, it never completely reverts to pre-crisis levels, thus suggesting how “sticky” economic narratives can become. Against the original expectations, though, there is no evidence that the financial press framed the last and most acute phase of the Greek crisis in 2015 in increasingly moral terms.

Rebalance Your Investment Portfolio Periodically: Mantra or Myth?

Rebalance Your Investment Portfolio Periodically: Mantra or Myth?

The Semiosis of Stock Market Indices: Taking Charles Sanders Peirce to a Trading Room

Stock market indices are among the signs populating financial markets and allowing traders to support their valuation work. The movements of the Dow Jones and the S&P 500 are constantly monitored, but how are they interpreted? Is this interpretation unique to each trader? Does it depend on how the indices are communicated? Considering these questions, this article aims to illustrate the heuristic interests of Charles Sanders Peirce’s semiotics. Peirce’s concepts can elucidate that stock indices assume different semiotic statuses. Depending on the financial context in which they operate, their signification and thus their function for traders will vary. This article demonstrates the usefulness of these concepts through empirical illustrations drawn from the literature, the financial press and a fieldwork in a trading room. Beyond this case study, this article reveals how the Peircian toolbox contributes to the studies of valuation signs.

Does regulatory punishment improve financial media’s information intermediary role?

When punished by regulators, the financial press in China becomes more conservative, publishing less critical news and weakening its corporate governance function. Our paper indicates that regulatory punishment against media impairs the financial media’s information intermediary role.

Peers’ media coverage releases and investor heterogeneity

PurposeThis study aims to examine the behaviour of institutional and retail investors in response to news about industry leaders (peer firms) and to determine its impact on the stock prices of other firms (focal firms) within the same industry.Design/methodology/approachThe study investigates the impact of peer news on investor behaviour of Chinese A-shares listed on the Shanghai and Shenzhen Stock Exchanges from 2010 to 2019. The media coverage of industry leaders is sourced from prominent Chinese online financial outlets and the Chinese Financial Press. Support vector machine is applied to identify the positive, neutral and negative news within the articles. The study uses event study and logistic regression to examine the effects of peer news on focal firms’ investor behaviour.FindingsThe results show that both good and bad news about leaders cause peers’ stock prices to increase initially, but then reverse within one quarter. Further analysis reveals that when leaders’ shares receive positive news coverage, institutional investors tend to exert excessive abnormal buying pressure on peers’ shares, resulting in overreactions. Conversely, retail investors do not actively trade on peers on leaders’ news day due to limited attention. In addition, the study shows that short-selling constraint inhibits bad news from reflecting in the stock prices.Originality/valueThe study highlights differences in investor behaviour. The finding that institutional investors tend to overreact more to peer firms’ news when focal firms are smaller and have a lower frequency of information disclosure supports the salient theory. This is consistent with the previous framework that suggests overreaction is more pronounced when it is difficult to combine external sources of information to evaluate the focal firms. In contrast, retail investors do not engage in active trading on peers on leaders’ news day due to the limited attention theory.

Universal Basic Buybacks

Share repurchases (buybacks) have been a recent source of controversy due to misperceptions of their economic effects on firms and shareholders. Commentators in the financial press, financial institutions, and even politicians have misunderstood the effects of share repurchases on share prices and/or shareholder enrichment. I demonstrate the economic effects of share repurchase using financial statement analysis and a residual income valuation (RIM) approach. Consistent with decades of prior finance and accounting research, the results demonstrate that share repurchases do not contribute incremental value to shareholders. Share repurchases do not increase price per share. However, share repurchase do reduce market value, increase financial leverage and certain profitability metrics, and increase the equity cost of capital.

Are We Rich Yet? The Rise of Mass Investment Culture in Contemporary Britain. By Amy Edwards

Are We Rich Yet? is a wonderful corrective to the idea that Britain became a financialized society in the late twentieth century simply as a result of the neoliberal policies of government. Yes, there was an explosion of investment culture from the 1980s, but Edwards seeks to avoid ‘falling into the trap of assuming the inevitability and immutability of right-wing political reform under the Thatcher governments after 1979’ (p. 3). Instead, she shows that the ground for investment opportunities in financial markets had been laid over more than a century and investor numbers grew gradually before rapidly taking off in the 1980s. Moreover, the take-off then had much to do with the roles of the financial press, high street banks, and assorted forms of popular culture. This is to decentre Thatcherism in accordance with much of the recent re-thinking of this period by historians of modern Britain. By tracing an investment climate which evolved over time and exploring the different experiences of various investors and investor groups, Edwards demonstrates that a small percentage of Britons were already active participants in financial markets by the 1980s. Ostensibly then, some of them were nascent financial subjects ripe for the shareholding opportunities presented by the large-scale privatizations of nationalized industries. Ironically, however, they were rendered less, not more, autonomous in their financial decision making from the 1980s. Increasingly, it became difficult for individuals to act independently of large financial institutions, not least because these institutions responded to the opportunities and threats of deregulation and increased competition by re-shaping themselves. This involved them expanding their remits to suck in a mass of (previously untargeted) ‘ordinary’ people as investors, for example, by opening share shops in shopping centres. Individuals’ investments were then massed into institutionally managed portfolios; institutions also hoovered up shares as people sought a quick return on their foray into investments in privatized companies. Accordingly, rather than creating a true share-owing democracy, Thatcherite reforms empowered financial institutions that increasingly mediated the relationship between people, their investments, and the companies they invested in. Ultimately, this was to the detriment of industry and disenfranchising for individual shareholders.

Playing the Market: Retail Investment and Speculation in Twentieth-Century Britain. By Kieran Heinemann

During my undergraduate studies a few years ago, friends encouraged me to use some of my limited disposable income to invest in a popular cryptocurrency. I have since watched with mild amusement as the potential return oscillated violently between over 500 per cent to about the same as if I had put it into a current account, and smirked at online adverts from the UK Financial Conduct Authority warning that ‘Investing can seem like a game, but the risks involved are very real’. It is this sort of mass participation in financial markets as entertainment which Kieran Heinemann takes as his subject in his timely and insightful Playing the Market. Heinemann shows that popular participation in the stock market, since the late nineteenth century up to the recent proliferation of small investors in cryptocurrencies (p. 221), was meaningfully driven by the exciting appeal of games, risk, and gambling rather than any calculating rationality, with the British possessing a peculiar appetite for risk contrasting to that of Europe. Playing the Market looks beyond existing accounts of the City of London to investigate moral discourses ‘from below’ (p. 2) of the financial press and betting shops. There, Heinemann identifies a much longer legacy of popular stock market culture across the interwar period and ascendent by the post-war age of affluence. This culture underlay but also acted in tension with Thatcher’s agenda of economic individualism and market populism, and repeatedly raised anxieties around the moral health of the nation. Playing the Market aligns strongly with a historiographical trend questioning predominant narratives of the postwar period which has recently found a centre of gravity around Aled Davies, Ben Jackson, and Florence Sutcliffe-Braithwaite’s edited volume The Neoliberal Age? (2021). By illuminating the hitherto unexamined popular discourses of stock market participation, Heinemann convincingly disrupts the idea that the Thatcherite moment was regenerative of Victorian values otherwise subdued by the mid-century corporatist social democratic welfare state.

Tradicionalidad discursiva y variación morfosintáctica en la prensa económica de la Ilustración española

Abstract During the second half of the eighteenth century, the consolidation of the periodical press and the circulation of the Enlightenment ideas in Spain led to the creation of a new type of informative discourse that began to deal specifically with economic matters. The Spanish financial press combines at least two types of textual traditions. If, on the one hand, the economic issues evoke the memoirs published by arbitristas and proyectistas in the seventeenth and eighteenth centuries, their textual organization follows the model of the eighteenth-century periodical press. These diaries constitute a channel for the development of linguistic elaboration processes that took place in the sphere of communicative distance during the formation of early modern Spanish. We have selected two newspapers on this subject, the Semanario Económico and the Correo Mercantil de España y sus Indias, to provide new data about the morphosyntax of Spanish throughout the second half of the eighteenth century. The phenomena analyzed are: §2 the distribution of subjunctive and conditional verbal forms; §3 the pronominal enclysis; §4 the use of the passive and constructions with se; §5 the syntactic structure en + gerund and §6 the relative clauses.

Fine-grained document-level financial event argument extraction approach

Document-level financial event argument extraction aims to extract a set of structured financial information related to particular financial events from a financial document. This task is challenging because there is complex fine-grained semantic information between financial event arguments, such as cross-document, inner-sentence and context semantic information. Existing approaches are still unable to capture these fine-grained financial semantic features well, leading to the low performance defects. Different from these existing approaches, we propose an end-to-end fine-grained document-level financial event argument extraction approach (FGD-FEAE), which defines event argument extraction as a sequence tagging task. In the encoder, a novel multiple granularity attention layer and a long-short term memory network (LSTM) extension layer are proposed and designed to effectively capture these fine-grained financial semantic information. In the decoder, to avoid the financial semantic confusion problem, a conditional random field (CRF) layer is constructed to jointly tag the financial event arguments. Finally, FGD-FEAE is tested on the two benchmark financial datasets, Chinese financial annotation dataset (ChiFinAnn) and English financial press releases (EFPR), and our own Chinese financial project dataset (ChiFD). These datasets contain a large amount of financial corpus information and complete financial event arguments and provide a solid foundation for verifying the general applicability of the proposed FGD-FEAE. Experimental results show that FGD-FEAE can achieve the better performance than the state-of-the-art approaches, and the performance is improved by 4.69, 5.01 and 3.78 on the three actual financial datasets, respectively.

Nowcasting GDP using tone-adjusted time varying news topics: Evidence from the financial press

Nowcasting GDP using tone-adjusted time varying news topics: Evidence from the financial press

Journalistic evaluation in financial news

The business and financial press plays an important role for capital markets, as it routinely reports on the financial results of large companies, thereby influencing how investors perceive the economic prospects of these companies. Despite the numerical and factualized nature of such news, financial journalists have considerable power in interpreting corporate results and evaluating them as positive or negative. We examine these journalistic evaluations as metadiscourse, focusing on the variety of evaluative language resources financial journalists draw on to convey positive or negative evaluations of companies and their financial results in their news stories. Our findings illustrate how financial journalists problematize the financial results of companies, distance themselves from corporate claims or endorse them, and downtone or reinforce evaluations by means of contrast. Our analysis suggests that financial journalists convey evaluations in a manner seemingly conformant with the genre ideals of neutrality and objectivity, despite exercising considerable power over the evaluation of financial news.

CFO credentials, stock market signaling, and firm performance

PurposeThis paper examines how “strategic” chief financial officers (CFOs) with an elite MBA (i.e. elite CFOs) influence (1) stock market reaction to CFO hiring announcements (ex ante measure) and (2) post-hiring firm performance (ex-post measure).Design/methodology/approachThis paper utilizes a comprehensive, proprietary database with information about the educational qualifications and prior professional experience of 1,340 CFOs hired during the period 1994–2014. For each CFO, the authors hand-collected data on the CFO's prior experience as well as CFO's educational profile. The authors also identified the date of CFO hiring from financial press articles. To evaluate performance, the authors consider two different, yet complementary performance measures: (1) the stock market reaction, a priori measure and (2) a traditional measure of performance, which is a post-facto metric related to firm performance.FindingsThe results show that hiring CFOs with scarce and strategic human capital elicits a positive market response and leads to significant improvement in firm performance. Further, firms with greater managerial discretion benefit more from hiring elite CFOs. The results hold after controlling for chief executive officer (CEO), CFO, top managment team (TMT), and board characteristics.Originality/valueThis study shows converging and mutually consistent results about what specific types of CFO human capital create firm value and, more importantly, show that such value-creation is only in the case of small firms and high growth firms. The study also advances the stream of literature that contrasts the relative benefits of specialist versus generalist qualifications.

How Do Financial Experts Choose Stocks?

Objective: This study aims to determine factors that affect financial experts as investors to buy stocks. Do financial experts have different considerations and preferences from ordinary investors in making an investment decision? Design/Methods/Approach: The research data were obtained from an online questionnaire by 581 financial experts with Securities Sub Account in Indonesian Central Securities Depository. This research employs exploratory factor analysis to examine the correlation between 29 attribute statements to develop factors. Findings: The eight groups of factors that affect the Indonesian financial expert’s considerations in the stock investment such as financial performance, comprehensive analysis, benefit signaling, company image, company insight, community involvement, investor preference, and press coverage. Originality: This study incorporates behavioral finance and maximization utility to provide a more comprehensive understanding of stock investment decisions by financial experts. Practical/Policy implication (optional): The result has practical, functional consequences for the investor, especially in the selected stock portfolio analysis. Investment analysis should consider the eight groups of factors found before choosing the stock. If the investors can not assume all factors, they can view the financial performance as the top rank factor. Thus the investor will maximize the investment return in the future.

Exploring agricultural entrepreneurship and new technologies: academic and practitioners' views

PurposeThis paper investigates the relationship between agricultural entrepreneurship (AE) and new technologies using academic and practitioners' perspectives to understand how new technologies such as artificial intelligence (AI), machine learning and augmented reality can promote agri-businesses.Design/methodology/approachThe paper adopts a content and thematic analysis of 325 academic sources extracted from the Scopus database and 683 patents retrieved from the European Patent Office (EPO) dataset. Additionally, the research applies the Kruskal–Wallis test as a non-parametric test for evaluating differences in the main concepts discussed in the two sources.FindingsThe academic and practitioners' debate highlights a trading zone among the two streams. patents' analysis from the EPO reveals four main common themes as a new business that benefits from AI in weather predictions, new smart and intelligent ways to monitor crops, new businesses that use clouds to control plant's humidity. The analysis of Scopus's sources demonstrates theoretical approaches related to the technology acceptance model (TAM) and practical strategies in terms of entrepreneurial skills to support the agricultural sector. However, barriers among the two streams of sources exist in innovation management and scale-up entrepreneurial initiatives.Research limitations/implicationsRegarding implications, the authors aim to connect academic and practitioners' views by understanding the new potential innovation applications and the connected new research avenues. Limitations might arise from the sources used to develop our analysis.Originality/valueThe paper is novel because it investigates the issues arising from the relationship between AE and new technologies by examining original validated patents released by practitioners and approved by the EPO, rather than reviewing blogs or the financial press. This leads to a holistic understanding of the impact of tangible practices among agricultural entrepreneurs. The results support the view that new trading zones and case studies are needed to highlight and show the positive impact of technologies in this field. The authors argue that practitioners require scholars to reduce the ambiguity between AE and its expected results, leading to investments to boost new agricultural business ideas.

FİNANSAL HALKLA İLİŞKİLERDE WEB SİTESİ KULLANIMI: BORSA İSTANBUL 30 (BIST 30) ŞİRKETLERİNE YÖNELİK BİR ARAŞTIRMA

Halkla açık şirketlerin hisse değerlerini artırmak, finansal konumlarını güçlendirmek, finansal hedef kitleleri ile güvene dayalı ilişkiler tesis ederek bu kitleleri bilgilendirmek gibi amaçları elde etmek üzere yapılandırdığı finansal halkla ilişkiler çalışmaları günümüz rekabet ortamında büyük önem taşımaktadır. Söz konusu amaçların elde edilmesinde ise web siteleri etkili bir halkla ilişkiler aracı olarak kullanılmaktadır. Kuruluşlar web siteleri aracılığıyla finansal hedef kitlelerine zamanında ve hızlı bir şekilde bilgileri ulaştırabilmekte ve bu bilgiler aracılığıyla güveni oluşturabilmektedir. Finansal hedef kitlelerle ilişkiler kuruluşların web sitelerinde “yatırımcı ilişkileri” başlığı altında yer almaktadır. Bu çalışmanın amacı Borsa İstanbul 30 (BIST30) Endeksinde işlem gören şirketlerin web sitelerinde yer alan yatırımcı ilişkileri bölümlerini inceleyerek finansal halkla ilişkiler açısından değerlendirmektir. Nitel araştırma desenlerinden durum çalışması desenine göre yürütülen bu çalışmada veri toplama tekniği olarak doküman incelemesi ve verilerin analizi için de içerik analizi yöntemi kullanılmıştır. BIST30 Endeksinde işlem gören şirketlerin web sitelerinde yatırımcı ilişkileri bölümlerinde yer alan bilgiler içerik analizi yöntemi kullanılarak “erişim”, “açıklık”, “içerik”, “yatırımcı desteği”, “teknoloji” kategorileri altında incelenmiştir. Analiz sonucunda erişim kategorisinde 11, açıklık kategorisinde 3, içerik kategorisinde 17, yatırımcı desteği kategorisinde 1, teknoloji kategorisinde 11 şirketin tam puan aldığı görülmüştür.

Natural Experiments on the Impact of Financial Performance on Subsequent Changes in ESG Ratings

Much of the current reporting in the financial press suggests that companies with superior environmental, social, and governance (ESG) ratings outperform their competitors financially. However, and despite numerous studies on the relationship between a corporation’s financial performance (FP) and its ESG score, researchers are yet to reach a consensus on whether there is indeed a causal relationship between FP and ESG. Here, we explicitly investigate the issue of reverse causality – while better ESG performance might lead to higher subsequent FP due to improved corporate reputation and less investment risk, it can also be argued that companies with higher FP have more slack resources, which are used for subsequent ESG investments. Endogeneity may mask the genuine relationship between variables; hence we employ a natural experiment method, using three distinct large-wave exogenous shocks in the market (the Enron/Worldcom scandal, the global financial crisis, and the introduction of Obama’s climate change bill) to attempt to resolve this issue. Consistent with the slack resources theory first proposed by Waddock and Graves (1997) in the FP?ESG context, we find that corporations with superior FP in one period have more engagement in ESG-related activities in subsequent periods. We use both accounting-based and market-based measures for FP, and our results remain robust for all three exogenous shock episodes. We conclude by discussing implications for future research.

Do Share Repurchases Distort Stock Prices? Evidence from the United States and Malaysia

Heavy share buyback years after the global finance crisis 2008–2009 drew criticism from scholars and financial press that share repurchases were being used by firms to manipulate their stock prices. This paper examines whether a greater firm’s repurchase intensity distorts stock prices reflecting to information. We analyse 2 sets of unbalanced panel data that contain a sample of 337 US and another sample of 167 Malaysian repurchasing firms between 2012 and 2016. Contrary to the criticism, we find that a greater firms’ share buyback intensity in the USA stimulates faster incorporation of information in price and results in more efficient stock prices. The main findings hold true and are robust when an alternative measure of share repurchase intensity was used. The findings of US sample support the notion that share repurchase serves as a signalling tool and price support to promote more efficient stock prices. We also find no strong evidence supporting the notion that shares repurchased by Malaysian firms distort stock prices. JEL Classifications: G10, G14, G35