Does the online interaction between retail investors and firms affect stock price synchronicity?

Zhenxing Huang, Jialiang Liu, Xiaojia Zhang and WeiWei Li

Finance Research Letters, 2024, vol. 69, issue PB

Abstract: Using data from Chinese listed companies from 2010 to 2022, we examine the effect of online interactive platforms on stock price synchronicity. We find that investor–firm interactions increase stock price synchronicity. These results are robust to endogeneity checks. Our mechanism analysis suggests that information asymmetry accounts for this effect. This effect is more pronounced for firms with fewer institutional investors and those facing periods of heightened economic policy uncertainty.

Keywords: Retail investor; Online interaction platforms; Stock price synchronicity (search for similar items in EconPapers)
JEL-codes: D83 G12 G14 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:69:y:2024:i:pb:s1544612324012303

DOI: 10.1016/j.frl.2024.106201

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