Insiders’ incentives of using a specific disclosure tone when trading

Sandulescu, Paula Mirela

doi:10.1016/j.scoms.2015.03.009

Cited by 5 publications

(5 citation statements)

References 47 publications

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“…This overall positive tone has been empirically confirmed based on hand-coded data (Clatworthy and Jones, 2003;Osma and Guillamón-Saorín, 2011) and automated sentiment analysis tools (e.g. Kothari et al, 2009;Sandulescu, 2015). We hypothesize as follows: H1: Earnings press releases are more positive in tone than negative.…”

Section: Tone In Corporate Earnings Press Releasesmentioning

confidence: 65%

“…Furthermore, our study has implications for the study of tone in financial news, which has typically been measured as one integrative indicator of overall tone (e.g. DiStaso, 2012;Fogarty and Rogers, 2005;Henry, 2008;Sandulescu, 2015). Such an indicator could dilute high levels of negative tone, if the positive tone is also sufficiently high.…”

Section: Discussionmentioning

confidence: 94%

“…Previous research on the tone of financial news has measured the overall tone of a news text as the difference or ratio between positive and negative tones (e.g. DiStaso, 2012;Fogarty and Rogers, 2005;Henry, 2008;Sandulescu, 2015), which neutralizes the intensity of tone. We see tone as an overarching construct that consists of positive tone and negative tones as separate constructs.…”

Section: Tone In Financial Newsmentioning

confidence: 99%

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Tone variation in financial news: A comparison of companies, journalists and financial analysts

Pollach

Hansen

2021

European Journal of Communication

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This article reports the findings of a comparative study of the financial news produced by companies, financial analysts, financial newspapers and news agencies about the same news events, including data before and after the financial crisis. We ground this study in second-level agenda-setting, according to which news producers select substantive and evaluative attributes for the issues they cover. Using computer-assisted text analysis, we conduct pairwise comparisons of the evaluative tone of corporate quarterly earnings press releases and the corresponding analyst reports and news stories. Our overall hypothesis is that these actors produce news about the same events with an evaluative tone that furthers their own goals as well as the goals of those actors they are dependent on, which we find partial support for. We find a positivity bias in corporate earnings press releases and analyst reports, while financial journalists eliminate the corporate positivity bias, but do not add more negativity. The results also indicate differences in the tone of financial news before and after the financial crisis. Although all actors produce news in the period after the financial crisis that is less positive and less negative than before the crisis, the balance of positive and negative tone as well as relative differences among the actors suggest that news writing by financial journalists at financial newspapers and news agencies is more negative in tone after the financial crisis, thus providing also empirical support of their independence.

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Section: Tone In Corporate Earnings Press Releasesmentioning

confidence: 65%

Section: Discussionmentioning

confidence: 94%

Section: Tone In Financial Newsmentioning

confidence: 99%

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Tone variation in financial news: A comparison of companies, journalists and financial analysts

Pollach

Hansen

2021

European Journal of Communication

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“…Ji and Tan (2016) studied changes in firms' disclosure policies in response to labor unemployment concern using the tone of 10K and 10 Q filings and found it as an essential consideration for corporate discretionary disclosure. Sandulescu (2015) investigated the relations between disclosure tone, insider trading, and returns and found that the net disclosure tone predicts the insider purchase ratio (purchases scaled by the sum of purchases and sales) and abnormal returns after controlling for past purchases, return volatility, and firm characteristics.…”

Section: Tone Analysismentioning

confidence: 99%

Text analysis in financial disclosures

Ravula¹

2021

Preprint

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Financial disclosure analysis and Knowledge extraction is an important financial analysis problem. Prevailing methods depend predominantly on quantitative ratios and techniques, which suffer from limitations like window dressing and past focus. Most of the information in a firm's financial disclosures is in unstructured text and contains valuable information about its health. Humans and machines fail to analyze it satisfactorily due to the enormous volume and unstructured nature, respectively. Researchers have started analyzing text content in disclosures recently. This paper covers the previous work in unstructured data analysis in Finance and Accounting. It also explores the state of art methods in computational linguistics and reviews the current methodologies in Natural Language Processing (NLP). Specifically, it focuses on research related to text source, linguistic attributes, firm attributes, and mathematical models employed in the text analysis approach. This work contributes to disclosure analysis methods by highlighting the limitations of the current focus on sentiment metrics and highlighting broader future research areas.Keywords NLP • bag-of-words • Disclosures • Machine learning • EDGAR • Text analysis 1 SEC History https://www.sec.gov/about/reports/sec-fy2015-agency-mission-information.pdf

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“…Price et al (2012) based on the quarterly conference call study, management tone is an important predictor of the company's abnormal returns and trading volume. Sandulescu (2015) found that the more positive the tone of the MD&A, the more followers buy the stock. Jegadeesh and Wu (2013) found that the more positive vocal about the disclosure of risk information, the weaker the IPO bargaining.…”

Section: Management Tone Contentmentioning

confidence: 99%

Research on Management Over-optimistic Measurement：Based on Text Sentiment Analysis

2019

EJBM

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Over-optimism managers have an important impact on corporate financing decisions.Based on the text sentiment mining technology, this paper calculates the optimism of management by constructing the emotional lexicon and using the frequency of optimistic and pessimistic vocabulary in the PFP language statistical annual report. In this paper, by constructing a theoretical model reflecting the degree of optimism of management, the residual of the model is used as the proxy variable of management over-optimism, and the rationality judgment is carried out, which provides a good research tool and method for the subsequent investigation.

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Insiders’ incentives of using a specific disclosure tone when trading

Cited by 5 publications

References 47 publications

Tone variation in financial news: A comparison of companies, journalists and financial analysts

Tone variation in financial news: A comparison of companies, journalists and financial analysts

Text analysis in financial disclosures

Research on Management Over-optimistic Measurement：Based on Text Sentiment Analysis

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