Complexity Aversion When Seeking Alpha /

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Bibliographic Details
Author / Creator:Umar, Tarik, author.
Ann Arbor : ProQuest Dissertations and Theses, 2017
Description:1 electronic resource (61 pages)
Format: E-Resource Dissertations
Local Note:School code: 0330
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Other authors / contributors:University of Chicago. degree granting institution.
Notes:Advisors: Lubos Pastor; Kelly Shue Committee members: Amir Sufi; Richard Thaler.
Dissertation Abstracts International, Volume: 78-12(E), Section: A.
Summary:I provide causal evidence that textual complexity affects investor and market behavior, using two complementary settings. First, examining field data with randomization from Seeking Alpha, I find that a standard-deviation increase in headline length (negativity) leads to 12%-fewer (2%-more) views. The effects are larger for less-sophisticated investors. Second, examining firm-earnings releases, I find a market effect by instrumenting title length with company-name length. A standard deviation increase in length leads to 5%-less-announcement turnover, 50-basis-points-tighter-intraday-price ranges, and 40-basis-points-return underreactions, correcting within one month.