Analyst Recommendations and Gender: Measuring the Performance of Newspaper Stock Recommendations

Sammanfattning

This study measures the effect that stock recommendations published by financial newspapers can have on actual stock prices and how that effect depends on the gender of the person making the recommendation. We construct a dataset with 3170 stock recommendations published by the Swedish financial newspaper Dagens Industri over three years and find evidence that recommendations have a direct effect on short-term stock returns and that this effect is stronger if the recommendation was made by a man, even after controlling for stock characteristics. One year after each recommendation, the stock had on average underperformed the benchmark index and no significant differences between male and female recommendations can be observed, further suggesting that the initial differences in price movements depend on how readers perceive the articles rather than differing abilities in predicting stock returns.