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- Title
Peer Effects in Equity Research.
- Authors
Phua, Kenny; Tham, Mandy; Wei, Chishen
- Abstract
We study the importance of peer effects among sell-side analysts who work at the same brokerage house, but cover different firms. By mapping the information network within each brokerage, we identify analysts who occupy central positions in the network. Central analysts incorporate more information from their coworkers and produce better research. Using shocks to network structures around brokerage mergers, we identify the influence of peer effects and the importance of industry expertise on analysts' performance. A portfolio strategy that exploits the forecast revisions of central analysts earns up to 24% per annum.
- Subjects
PEERS; STOCKS (Finance); RESEARCH; STOCKBROKERS; FINANCIAL analysts; COWORKER relationships; EXPERTISE; INFORMATION sharing; MERGERS &; acquisitions
- Publication
Journal of Financial & Quantitative Analysis, 2023, Vol 58, Issue 2, p647
- ISSN
0022-1090
- Publication type
Article
- DOI
10.1017/S0022109022000710