Abstract
This paper examines whether the change in stock liquidity subsequent to voluntary disclosure is different between good news and bad news. Using voluntary 8-K filings, we find that the increase in stock liquidity is more pronounced for firms with good news disclosure than for firms with bad news disclosure. In addition, such findings are stronger when a firm is less visible and when the short-selling costs are high, suggesting that these two factors play an important role in increasing stock liquidity. Overall, this paper provides evidence that the tone of voluntary 8-K news is an important determinant of stock liquidity.
| Original language | English |
|---|---|
| Pages (from-to) | 803-846 |
| Number of pages | 44 |
| Journal | Accounting and Finance |
| Volume | 61 |
| Issue number | 1 |
| DOIs | |
| State | Published - Mar 2021 |
ASJC Scopus Subject Areas
- Accounting
- Finance
- Economics, Econometrics and Finance (miscellaneous)
Keywords
- 8-K filings
- Disclosure tone
- Stock liquidity
- Textual analysis
- Voluntary disclosure
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