Publication Type

Journal Article

Version

Publisher’s Version

Publication Date

10-2010

Abstract

We find that analysts are more likely to issue favorable recommendations for stocks predominantly owned hedge funds. Moreover, these optimistic recommendations translate into poorer stock performance over the next three to six months. Hedge funds take advantage of these flattering reports by concurrently offloading their stock holdings. Our results suggest that analysts are reluctant to downgrade stocks held by their most important clients.

Keywords

Hedge funds, stock recommendations, stock performance

Discipline

Finance and Financial Management

Publication

Hedge Fund Insights: Newsletter of the BNP Paribus Hedge Fund Centre at SMU

First Page

2-9

Publisher

BNP Paribus Hedge Fund Centre, Singapore Management University

City or Country

Singapore

Copyright Owner and License

BNP Paribus Hedge Fund Centre, Singapore Management University

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