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Intercity mentioning: Stock posts, city network, and firms

Dayong Dong, Danling Jiang, Yuelin Peng, Longmin Shen and Hongquan Zhu

Journal of Corporate Finance, 2025, vol. 93, issue C

Abstract: We analyze online stock posts to identify dynamic intercity investment preferences among Chinese investors. By inferring city connections using recent posts on local stocks mentioning other cities, we find that firms in highly connected cities exhibit higher stock valuations, greater turnover, higher idiosyncratic volatility, improved liquidity, and reduced crash risk. The network effects are more pronounced among less visible firms and induce intercity return comovement. Better stock performances in connected cities predict subsequent local stock return reversals as well as elevated intercity retail block trading. Our findings suggest that city connectivity, revealed through social media content, influences firm outcomes, investor behavior, and market efficiency.

Keywords: Intercity investment preference; Online stock post; City connectivity; Network effects; Investor behavior (search for similar items in EconPapers)
JEL-codes: G11 G12 G15 G32 G40 G41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:93:y:2025:i:c:s0929119925000719

DOI: 10.1016/j.jcorpfin.2025.102803

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