Su, C., Zhang, H. orcid.org/0000-0002-8727-4906 and Joseph, N. (2022) The performance persistence of analyst recommendation revisions: does brokerage house reputation matter? International Journal of Finance and Economics, 27 (3). pp. 3051-3070. ISSN 1076-9307
Abstract
Our study examines the impact of brokerage house (BH) reputation on the performance of investment strategies following stock recommendation revisions in the UK stock market. We develop two alternative proxies for BH reputation based either on the past positions on the annual Institutional Investor (II) All‐Europe Research Team or on the past recommendation performance of BHs. We find that BH reputation proxied by the past II rankings has no significant impact on the recommendation performance, suggesting that the II rankings are largely “popularity contests”. However, BH reputation proxied by the past year recommendation performance of BHs has a significantly positive impact on the recommendation performance in the next year, implying that the recommendation performance of BHs in the UK market is persistent. The bootstrap simulations further confirm that the observed performance persistence could be due to BH skill rather than BH luck (i.e., random chance).
Metadata
Item Type: | Article |
---|---|
Authors/Creators: |
|
Copyright, Publisher and Additional Information: | © 2020 The Authors. International Journal of Finance & Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, (http://creativecommons.org/licenses/by/4.0/) which permits use, distribution and reproduction in any medium, provided the original work is properly cited. |
Keywords: | Stock recommendation revisions; brokerage house reputation; performance; persistence; bootstrap simulations; financial analysts |
Dates: |
|
Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Management School (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 05 Oct 2020 12:36 |
Last Modified: | 06 Jun 2024 08:25 |
Status: | Published |
Publisher: | Wiley |
Refereed: | Yes |
Identification Number: | 10.1002/ijfe.2312 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:166099 |