Another look at the holiday effect: evidence from sell-side analysts’ forecasts

Zheng Liu, Yingfei Liu, Qiankun Gu and Huiqiang Wang

Economic Analysis and Policy, 2025, vol. 87, issue C, 351-382

Abstract: This paper tests whether and how sell-side financial analysts in the United States react to the holidays of their countries of origin. Based on these holiday identifiers, we find that analysts’ forecasts are less biased before these holidays, but shortly after these holidays, analysts’ forecasts are more accurate, and recommendations are related to more market reactions. These results are robust to control for January/December, and Monday/Friday effect. The accuracy effect is also robust to alternative measurements. We further show that the relationship is more pronounced in the subsample of male analysts, analysts whose highest degree is a bachelor’s, follower analysts, and analysts who do not graduate from the top ten universities. In addition, we show that the association mainly exists in large size firms and firms with stable operations. Lastly, we show that our results are robust to alternative cultural elements, including social trust, hierarchy, and individualism.

Keywords: Holiday effect; Forecast accuracy; Forecast bias (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0313592625002358
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:87:y:2025:i:c:p:351-382

DOI: 10.1016/j.eap.2025.06.008

Access Statistics for this article

Economic Analysis and Policy is currently edited by Clevo Wilson

More articles in Economic Analysis and Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().