 Board structure and stock price informativeness in terms of moving average rulesPaoyu Huang and Yensen Ni The Quarterly Review of Economics and Finance, 2017, vol. 63, issue C, 161-169 Abstract: According to the moving average (MA) trading rules, investors are likely to buy stocks after the golden cross occurs and sell stocks when the dead cross appears. Proxies for stock price informativeness, such as the days when the short-term MA is higher than the long-term MA over the total number of trading days in a year (hereafter referred to as DMA), can be affected by board structure. Results reveal that a high DMA tends to occur in firms with well-functioning board structures. Furthermore, DMA can be quickly updated as daily share prices are released. Consequently, the enhanced or weakened function of board structure may be disclosed quickly by DMA unlike other proxies of stock price informativeness/firm performance, such as stock return, ROA, ROE, and Tobin's q. We argue that DMA serves as a new proxy that may not be inferior to and is even better than other proxies, which might contribute to the existing literature. Keywords: Stock price informativeness; Moving average; Board structure (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:quaeco:v:63:y:2017:i:c:p:161-169 DOI: 10.1016/j.qref.2016.04.012 Access Statistics for this article The Quarterly Review of Economics and Finance is currently edited by R. J. Arnould and J. E. Finnerty More articles in The Quarterly Review of Economics and Finance from Elsevier |
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