The Usefulness to Individual and Institutional Investors of Annual Earnings Announcements and Sec Filings by Non-U.S. Companies
Posted: 24 Feb 1997
Date Written: January 1997
Abstract
This study examines the usefulness and the speed in processing of annual earnings announcements and SEC filings by non-U.S. companies listed on either the New York or American Stock Exchange. Intraday trading data and a methodology developed in Cready (1988) and Cready and Mynatt (1991) are utilized to determine if the above characteristics are related to investor wealth. The results indicate that annual earnings announcements of non-U.S. companies are useful to both institutional and individual investors. With respect to the SEC filings, no unexpected trading activity was detected surrounding the filing dates for the entire sample period (1983-1992) for either institutional or individual investors. However, when the sample was restricted to post-1988 filings, which corresponds to a dramatic rise in the market value of non-U.S. equity securities listed in the U.S., the information in the SEC filings was found to be useful to both institutional and individual investors. Finally, for both the earnings announcements and the post-1988 SEC filings, institutional investors appear to process the information more quickly than do individual investors, and the value of the the information increases with investor wealth.
JEL Classification: M41, K22
Suggested Citation: Suggested Citation