 Does Financial Statement Comparability Reduce Differences in Sentiment‐induced Investor Trading Behaviour?Eun Hye Jo and Jung Wha (Jenny) Lee Abacus, 2026, vol. 62, issue 2, 422-468 Abstract: This study examines whether comparable financial information can mitigate differences between individual and institutional investors’ trading behaviour, particularly behaviour that is shaped by investor sentiment. The results indicate that the higher the comparability, the smaller the gap in trading behaviour driven by investor sentiment between institutional and individual investors. In particular, the tendency of individual investors to purchase stocks associated with high investor sentiment is mitigated by comparable financial information. However, the study also reveals that comparability does not significantly affect institutional investors’ investment decisions. Furthermore, the effect of comparability in minimizing differences in trading behaviours resulting from investor sentiment is more pronounced for firms that are difficult to evaluate (such as young, volatile, non‐dividend‐paying firms with extreme market‐to‐book ratios, and those with limited analyst coverage) as well as firms operating in less competitive industries. Overall, these findings collectively indicate that comparability benefits investors and highlights which types of investors stand to gain from it. Date: 2026 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:abacus:v:62:y:2026:i:2:p:422-468 Ordering information: This journal article can be ordered from Access Statistics for this article Abacus is currently edited by G.W. Dean and S. Jones More articles in Abacus from Accounting Foundation, University of Sydney |
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