Does Board Independence Reduce Informed Short Selling Prior to Earnings Announcements? Evidence From Quasi-Natural Experiment

2019 ◽  
Author(s):  
Suchismita Mishra ◽  
Anisur Rahman ◽  
Arun Upadhyay
Keyword(s):  
Natural Experiment ◽  
Earnings Announcements ◽  
Short Selling ◽  
Board Independence

scholarly journals Board independence and firm value: A quasi-natural experiment using Taiwanese data

2020 ◽  
Vol 57 ◽  
pp. 71-88 ◽  
Author(s):  
Yaoyao Fan ◽  
Yuxiang Jiang ◽  
Mao-Feng Kao ◽  
Frank Hong Liu
Keyword(s):  
Firm Value ◽  
Natural Experiment ◽  
Board Independence

Short-Selling and Information Arrival around Earnings Announcements: Evidence from Regulation SHO

2021 ◽  
Author(s):  
Greg Clinch ◽  
Wei Li
Keyword(s):  
Stock Prices ◽  
Earnings Announcements ◽  
Public Information ◽  
Short Selling ◽  
Price Informativeness ◽  
The Public ◽  
Short Sellers ◽  
Information Release ◽  
Negative News ◽  
Shed Light

Short sellers assist in impounding negative news more quickly into stock prices and improve price informativeness. However, there is a lack of consistent evidence about whether short sellers trade predominantly in anticipation of, or in response to, a public information release. To shed light on this question, we exploit Reg SHO, which reduced the constraints faced by short sellers for a subsample of U.S. firms, to examine price informativeness before, during and after earnings announcements. We show that relative to control firms, pilot firms have greater (less) price informativeness before (during) earnings announcements, suggesting that short sellers trade in anticipation of public earnings news, rather than in response to the public news.

Board independence and short selling

2020 ◽  
pp. 101616
Author(s):  
Anisur Rahman ◽  
Bakhtear Talukdar ◽  
Rafiqul Bhuyan
Keyword(s):  
Short Selling ◽  
Board Independence

Does board independence substitute for external audit quality? Evidence from an exogenous regulatory shock

2017 ◽  
Vol 43 (1) ◽  
pp. 27-41 ◽  
Author(s):  
Pornsit Jiraporn ◽  
Pandej Chintrakarn ◽  
Shenghui Tong ◽  
Sirimon Treepongkaruna
Keyword(s):  
Natural Experiment ◽  
Audit Quality ◽  
Causal Effect ◽  
Board Independence ◽  
Difference In Difference ◽  
External Audit ◽  
Effective Governance ◽  
Sarbanes Oxley ◽  
Big 4 ◽  
Quality Evidence

Exploiting the passage of the Sarbanes–Oxley Act (SOX) as an exogenous regulatory shock, we investigate whether board independence substitutes for external audit quality. Based on over 14,000 observations across 18 years, our difference-in-difference estimates show that firms forced to raise board independence are far less likely to employ a Big 4 auditor. In particular, board independence lowers the propensity to use a Big 4 auditor by approximately 38%. Firms with stronger board independence enjoy more effective governance and therefore do not need as much external audit quality as those with less effective governance do. Based on a natural experiment, our empirical strategy is far less vulnerable to endogeneity and is thus considerably more likely to show a causal effect, rather than merely an association.

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