Corporate Transparency And Impact of Investor Sentiment on Stock Prices

Document Type : Research Paper

Authors

Abstract

This study is aimed to examine the effects of corporate transparency (measured by some proxies including accruals-based earnings management, audit opinions, the quality of audit firms, state ownership and the related party transactions) on the investors' optimism and pessimism toward stock prices, which usually occur due to difficulties in firm valuations. To highlight the important role of corporate transparency in decision making of investors, we test five hypotheses. For this purpose, monthly data of 70 firms listed in Tehran Stock Exchange during the period from 2009 to 2014 is analyzed through the time series analysis. The findings approves the first, second, fourth and fifth hypotheses suggesting more effects of investor sentiment on stock prices in firms with more accruals-based management, unqualified audit reporting, more related party transactions and State-controlled firms, as compared to  firms with less accruals-based management, qualified audit reporting, less related party transactions, and private companies. Also, in respect to the third hypothesis which is not confirmed, the findings show that there is no significant difference between investor sentiment effects on stock prices in firms audited by the Audit Organization and those of firms audited by the other audit institutions. As a whole, the findings confirm the important role of corporate transparency in mitigating the effects of investor sentiment on stock prices.
 

Keywords

Main Subjects

References

آذر، عادل؛ رستمی، محمدرضا و محمد صفری. (1392). ﺗﺤﻠﯿﻞ ﻣﻘﺎﯾﺴﻪ­ای ﻋﻮاﻣﻞ ﻣﺆﺛﺮ در ﻗﯿﻤﺖ­ﮔﺬاری زﯾﺮ ارزش ذاﺗﯽ در ﻋﺮﺿﻪ ﻋﻤﻮﻣﯽ اوﻟﯿﻪ ﺳﻬﺎم ﺷﺮﮐﺖ­ﻫﺎی دوﻟﺘﯽ و ﻏﯿﺮدوﻟﺘﯽ؛ ﻣﻄﺎﻟﻌﻪ ﻣﻮردی: ﺷﺮﮐﺖ­ﻫﺎی ﭘﺬﯾﺮﻓﺘﻪ در ﺑﻮرس اوراق ﺑﻬﺎدار ﺗﻬﺮان در ﺳﺎل­های 1380 تا 1388. دو فصلنامه اندیشه مدیریت راهبردی، سال هفتم، شماره اول، صص 185-157.
تقی پوریان گیلانی، یوسف؛ سیدمحمدرضا رئیس زاده و محبوبه زره داریان. (1394). اثر آگاهی سرمایه‌گذار و نگرش به ریسک درک شده بر رفتار سرمایه‌گذاران بورس اوراق بهادارتهران، کنفرانس بین المللی دست آوردهای نوین پژوهشی مدیریت حسابداری اقتصاد، تهران، موسسه آموزش عالی نیکان، https: //www. civilica. com/Paper-ACONF01-ACONF01_074. html
حیدرپور، فرزانه؛ تاری وردی، یداله و مریم محرابی. (1392). تأثیر گرایش‌های احساسی سرمایه گذاران بر بازده سهام. فصلنامه دانش مالی تحلیل اوراق بهادار، دوره 6، شماره 1، صص 13-1.
خالقی مقدم، حمید و علیرضا خالق. (1388). شفافیت شرکتی در ایران و عوامل موثر بر آن. مطالعات تجربی حسابداری مالی، شماره 21، صص 31-60.
رهنمای رودپشتی، فریدون؛ حاجی­ها، زهره و علی زارعی سودانی. (1387). کارکرد مالی رفتاری در تبیین پایگاه علمی برای تجزیه و تحلیل سهام. فصلنامه تولید علم، سال سوم، شماره 7، تابستان.
سینایی، حسنعلی و عبدالله داودی. (1388). بررسی رابطه شفاف­سازی اطلاعات مالی و رفتار سرمایه­گذاران در بورس اوراق بهادار تهران. دوفصلنامه تحقیقات مالی، دوره 11، شماره 27، صص 60-43.
عطری، حسن و معصومه جمشیدی. (1393). بررسی میزان اهمیت عوامل موثر بر رفتار سرمایه­گذاران سهام عادی در تالار بورس اوراق بهادار قم و مقایسه تطبیقی آن با رفتار سرمایه­گذاران سهام عادی در تالار بورس اوراق بهادار تهران. پایان­نامه کارشناسی ارشد حسابداری، دانشگاه آزاد اسلامی واحد تهران مرکزی.
فلاح شمس لیاستانی، میرفیض و راضیه رمضانی. (1395). بررسی نوسانات غیرمتعارف بر بروز رفتار توده‌وار در بورس اوراق بهادار تهران. پایان­نامه کارشناسی ارشد حسابداری، دانشگاه آزاد اسلامی واحد تهران مرکزی.
یوسفی، راحله و ابوالفضل شهرآبادی. (1388). بررسی و آزمون رفتار توده­وار سرمایه­گذاران در بورس اوراق بهادار. فصلنامه مدیریت توسعه و تحول، پیش­شماره دوم، صص 64-57.
Atri , H. , Jamshidi , M. (2015). Investigating the Importance of Factors Affecting the Behavior of Common Stock Investors in Qom Stock Exchange, And Comparing It With the Behavior of Common Stock Investors In Tehran Stock Exchange, MSc. Islamic Azad University, Central Tehran Branch. (In Persian)
Azar, A. , Rostami, M. R. , and Safari, M. (2014). A Comparative Analysis of Determinants of the Underpricing IPOs of Governmental and Non-governmental Companies; A Case Study of Accepted Governmental and Non-governmental Companies in Tehran Stock Exchange in 2002-2010. Semi-Annully Strategic Management Thought (Management Thought) , 7 (1) , 157-185. (In Persian)
Baker M, Wurgler J (2006) Investor sentiment and the cross-section of stock returns. J. Financ,e 61: 1645–1680.
Ball R, Kothari SP, Robin A. (2000). The effect of international institutional factors on properties of accounting earnings. J. Accounting Econom, 29: 151.
Bushman R. M. , O. Chen, E. Engle and A. Smith. (2004). Financial accounting information, organizational complexity and corporate governance system, Working Paper, University of North Carolina.
Bushman RM, Piotroski JD, Smith AJ. (2004). What determines corporate transparency. J. Accounting Res, 42: 207–252.
Carol A. Marquardt and Christine I. wide man. (2004). the effect of earning management on the valve relevance of accounting information. journal of business finance and accounting, 31 (3) & (4): 297- 332.
Choi SK. , Jeter DC.) 1992 (. The effects of qualified audit opinion on earnings response coefficients. Journal of Accounting and Economics, 15 (2): 229-248.
Dechow Patricia, Sloan Richard and Sweeney Amy P. (1995). Detecting earnings management. The Accounting Review, 70, 2: 193–225.
Defond, M. L. , T. J. Wong and S. Li. (2000). The impact of improved auditor independence on audit market concentration in Chian. Journal of Accounting and Economics, 28: 269-305.
Dipiazza, S. and Eccles, R. (۲۰۰۲). Building Public Trust, The future of Corporate Reporting John wiley & sons.
Fallahshams , M. , Ramezani , R. (2017). Investigating Unconventional Fluctuations on Massive Behavior In Tehran Stock Exchange, MSc. Islamic Azad University, Central Tehran Branch. (In Persian)
Fama EF, French KR. (1993). Common risk factors in the returns on stocks and bonds. J. Financial Econom, 33: 3–56.
Firth, M. , Wong, K. P. , & Wong, S. M. L. (2015). Corporate transparency and the impact of investor sentiment on stock prices. Management Science, 61 (7) , 1630-1647.
Gordon, E. A. and Henry, E. (2005). Related Party Transactions and Earnings Management. Retrieved from http: //papers. ssrn. com/sol3/ papers. Cfm abstract_id=612234&rec=1&srcabs=993532&alg=1& pos = 1.
Greenwood R, Nagel S. (2009). Inexperienced investors and bubbles. J. Financial Economic, 93: 239–258.
Hamilton, J. (1978). Marketplace organization and marketability: NASDAQ, the stock exchange and the national market system. Journal of Finance, Vol. 33: 487-503.
Heidarpoor, F. , Tariverdi, Y. , and Mehrabi, M. (2014). The Impact of Investor Sentiment on The Stock Returns. Quarterly Financial Knowledge of Security Analysis (Financial Studies) , 6 (1) , 1-13. (In Persian)
Hsiu J. F. (2006). Effect of Financial Information Transparency on Investor Behavior in Taiwan Stock Market. ProQuest Database, 16 (3) , 6- 22.
Hutton AP, Marcus AJ, Tehranian H. (2009). Opaque financial reports, r2, and crash risk. J. Financial Econo, 94: 67–86.
Khaleghi Moghaddam, H. , Khalegh, A. (2010). Corporate Transparency in Iran and Its Influential Factors. Empirical Studies in Financial Accounting Quarterly, 6 (21) , 31-60. (In Persian)
Kuan, L, Tower, G. , Rusmin, R. , J-L. W. Mitchell Van der Zahn. (2010). Related Party Transactions and Earnings Management. Journal Akuntansi & Auditing Indonesia, 14 (2): 93–115.
Lo AWY, Wong RMK, Firth M. (2010). Tax, financial reporting, and tunneling incentives for income shifting: An empirical analysis of the transfer pricing behavior of Chinese-listed companies. J. Amer. Taxation Assoc, 32 (2): 1–26.
Rahnamarodposhti , F. , Hajiha , Z. , and zareisodani , A. (2009). The Financial-Behavioral Function in Explaining The Scientific Base For Analyzing Stocks. Quarterly Science Productin, 3 (7). (In Persian)
Ritter, J. (1991). The long-run performance of initial public offerings. Journal of Finance, 46, 3-27.
Sinaei , H. , Davodi , A. (2010). Financial Information Transparency and Investor Behavior in Tehran Stock Exchange. Semi-Annually Financial Research, 11 (27). (In Persian)
Taghipouryan, Y. , Raiiszadeh, S. , and zarehdarian, M. (2016). The Impacts of Investor's Perception and Perceived Risk Perception on The investors Behavior of The Companies Listed in Tehran Stock Exchange. The International Conference on New Research in Management, Accounting and Economy, https: //www. civilica. com/PaperACONF01ACONF01_074. html. (In Persian)
Wu,Yanran. Han, Liyan. Tao, Ke. & Zhang, Zhongyuan. (2010). Investor Sentiment and the Day-of-the-Week Effect of Cross-Sectional Return. Available at www. ssrn. com
Yosefi, R. , Shahrabadi , A. (2010). Investigating and Testing the Massive Behavior of Investors in The Stock Exchange. Quarterly Journal of Development & Evolution Management, 1388 (2) , 57-64. (In Persian)
 

Files

History

  • Receive Date: 04 October 2016
  • Revise Date: 15 February 2017
  • Accept Date: 09 May 2017

Share

How to cite

Statistics