Bet-on agreements and stock price informativeness

Zhenzhen Zhao, Yuanqi Li and JianHan Wu

Finance Research Letters, 2025, vol. 74, issue C

Abstract: Betting agreements, with their growing popularity in enterprises, may profoundly affect a firm's information environment. Using a sample of publicly listed firms in China from 2011 to 2021, this study explores the effect of betting agreements and stock price informativeness. We find strong evidence that betting agreements increase stock price informativeness. Two potential economic channels, namely, media coverage and corporate governance, underpin this relationship. This study enriches the literature on betting agreements and stock price informativeness and offers important practical implications.

Keywords: Bet-on agreement; Stock price informativeness; Stock market; Efficiency (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:74:y:2025:i:c:s1544612324017100

DOI: 10.1016/j.frl.2024.106681

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