Do firms strategically respond to retail investors on the online interactive information disclosure platform?

Di Wu, Shenghao Gao, Kam C. Chan and Xiaoke Cheng

Finance Research Letters, 2022, vol. 47, issue PA

Abstract: Based on the official online interactive question and answer (Q&A) platform in China, we examine whether firms strategically change their response characteristics according to the tone of retail investors’ questions and how firms’ response choices affect stock market reactions to investors’ questions. Our findings show that firms respond less directly but more optimistically when the sentiment embedded in investors’ questions is more negative, consistent with the notions that firms are strategically responding to retail investors in the process of online interactive information disclosure. Additional analysis suggests that both the information embedded in the response and the textual characteristics of the response play an important role in stock valuation.

Keywords: Investor relations; Online interactive information disclosure; Retail investors (search for similar items in EconPapers)
JEL-codes: G10 G14 M41 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:47:y:2022:i:pa:s1544612321005675

DOI: 10.1016/j.frl.2021.102631

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