Journal article
Investor Inattention and Stock Prices: Evidence from Acquisitions with a Choice of Payment Type
Journal of financial and quantitative analysis, Vol.54(3), pp.1347-1369
06/01/2019
DOI: 10.1017/S0022109018000959
Abstract
I report evidence that shareholders holding a combined 15% of shares are inattentive or partially inattentive when confronted with the decision to receive cash or stock for their shares in acquisitions. The average cost of such inattention is 2%, and it increases to 6% for the tertile of transactions with the greatest difference between the cash and stock values. Most interestingly, I show that inattention affects stock prices because attentive shareholders bid up the stock price in anticipation of a wealth transfer from inattentive shareholders.
Details
- Title: Subtitle
- Investor Inattention and Stock Prices: Evidence from Acquisitions with a Choice of Payment Type
- Creators
- Erik Lie - Univ Iowa, Tippie Coll Business, Iowa City, IA 52242 USA
- Resource Type
- Journal article
- Publication Details
- Journal of financial and quantitative analysis, Vol.54(3), pp.1347-1369
- Publisher
- Cambridge Univ Press
- DOI
- 10.1017/S0022109018000959
- ISSN
- 0022-1090
- eISSN
- 1756-6916
- Number of pages
- 23
- Language
- English
- Date published
- 06/01/2019
- Academic Unit
- Finance
- Record Identifier
- 9984380485102771
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