Does Disclosure Quality via Investor Relations Affect Information Asymmetry

Millicent Chang, G. D'Anna, Iain Watson, Marvin Wee

Research output: Contribution to journalArticle

42 Citations (Scopus)

Abstract

High disclosure quality can be achieved through an effective investor-relations program and results infirm benefits such as enhanced market exposure, increased analyst coverage and institutional following. We examine the association between disclosure quality and information asymmetry where a checklist was used to evaluate a fit-in's Internet-based investor-relations practices. Firms with higher disclosure quality, through their investor-relations activities have higher analyst following, more institutional shareholders, more active trading, and are larger in terms of market capitalisation. Bid-ask spread decreased with increased disclosure quality, although the effect of investor relations was weaker in the presence of other factors.
Original languageEnglish
Pages (from-to)375-390
JournalAustralian Journal of Management
Volume33
Issue number2
DOIs
Publication statusPublished - 2008

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