Sunday, August 21, 2011
Investor Conferences and the Changing Nature of Analyst Research, by T. Clifton Green, Emory University - Goizueta Business School; Russell E. Jame, University of New South Wales; Stanimir Markov, University of Texas at Dallas - School of Management; and Musa Subasi, University of Texas at Dallas- School of Management, was recently posted on SSRN. Here is the abstract:
Market forces and new regulations have changed the emphasis of brokerage research away from stock recommendations and earnings forecasts and towards special services for select clients such as providing access to firm management. We examine how brokerage market shares are influenced by traditional published research and include a new measure of special service related to analyst-hosted investor conferences. Using a sample of institutional transactions, we find investor conferences have a significant effect on annual market share that is similar in magnitude to analyst coverage, as well as significant increases in market shares in conference stocks in the days following the event. Moreover, institutions pay higher commissions for conference stocks, which is consistent with compensation for premium research service.