“Noon Sunshine-Young Scholars Seminar” is a regular academic exchange platform held by School of Finance. It aims to offer valuable occasions of communications among scholars in our college, between teachers and students, the domestic and the oversea. In this semester, we keep our original intention, set off for a new voyage. We will devote ourselves to fostering the academic atmosphere in the college, and promoting the academic level for both teachers and students.

The first session of “Noon Sunshine-Young Scholars Seminar” for the Autumn Semester in 2023 is arranged as follows:

Lecture topic

Institutional game and stock returns: evidence from earnings announcements in China

Keynote Speaker: Xu Wei

Date

Thursday, September 7th, 2023

Time

12:00-13:00

Lecture Venue  

Room 116, School of Finance

Abstract

This paper aims to examine how institutional investors take advantage of the irrational behavior of retail investors by timing their trades around earnings announcements. Our findings reveal that institutional investors, strategically engaging in the institutional game, generate profits by purchasing shares prior to the announcement day of firms issuing positive guidance and subsequently selling them. Conversely, retail investors tend to incur losses as their trading counterparts. Through these results, we shed light on how rational trading can contribute to the emergence of mispricing. Furthermore, we suggest that information disclosure regulations may have unintended consequences on both market efficiency and fairness.