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Investor learning about analyst predictive ability

Publication ,  Journal Article
Chen, Q; Francis, J; Jiang, W
Published in: Journal of Accounting and Economics
February 1, 2005

Bayesian learning implies decreasing weights on prior beliefs and increasing weights on the accuracy of the analyst's past forecast record, as the number of forecast errors comprising her forecast record (its length) increases. Consistent with this model of investor learning, empirical tests show that investors reactions to forecast news are increasing in the product of the accuracy and length of analysts' forecast records. Moreover, the Bayesian learning predicted by our model is more descriptive of investor reactions than is a static model which predicts that investors' responses condition only on the prior accuracy of the analyst. © 2004 Elsevier B.V. All rights reserved.

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Published In

Journal of Accounting and Economics

DOI

ISSN

0165-4101

Publication Date

February 1, 2005

Volume

39

Issue

1

Start / End Page

3 / 24

Related Subject Headings

  • Accounting
  • 1502 Banking, Finance and Investment
  • 1501 Accounting, Auditing and Accountability
  • 1402 Applied Economics
 

Citation

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Chen, Q., Francis, J., & Jiang, W. (2005). Investor learning about analyst predictive ability. Journal of Accounting and Economics, 39(1), 3–24. https://doi.org/10.1016/j.jacceco.2004.01.002
Chen, Q., J. Francis, and W. Jiang. “Investor learning about analyst predictive ability.” Journal of Accounting and Economics 39, no. 1 (February 1, 2005): 3–24. https://doi.org/10.1016/j.jacceco.2004.01.002.
Chen Q, Francis J, Jiang W. Investor learning about analyst predictive ability. Journal of Accounting and Economics. 2005 Feb 1;39(1):3–24.
Chen, Q., et al. “Investor learning about analyst predictive ability.” Journal of Accounting and Economics, vol. 39, no. 1, Feb. 2005, pp. 3–24. Scopus, doi:10.1016/j.jacceco.2004.01.002.
Chen Q, Francis J, Jiang W. Investor learning about analyst predictive ability. Journal of Accounting and Economics. 2005 Feb 1;39(1):3–24.
Journal cover image

Published In

Journal of Accounting and Economics

DOI

ISSN

0165-4101

Publication Date

February 1, 2005

Volume

39

Issue

1

Start / End Page

3 / 24

Related Subject Headings

  • Accounting
  • 1502 Banking, Finance and Investment
  • 1501 Accounting, Auditing and Accountability
  • 1402 Applied Economics