The effects of rumours on financial market efficiency

Uriel Spiegel, Tchai Tavor, Joseph Templeman

Research output: Contribution to journalArticlepeer-review

21 Scopus citations

Abstract

During the last decade the world has faced a tremendous development of information technology and telecommunication. This study investigates the impact of rumours (released on the web) on common stock returns. The findings indicate that the market responds positively to rumours. During the event day and the five preceding days, the abnormal stock return is positive and statistically significant. In particular, the impact is stronger for single than for multi-rumours, for initial rather than subsequent rumours and for realized rumours than for nonrealized rumours.

Original languageEnglish
Pages (from-to)1461-1464
Number of pages4
JournalApplied Economics Letters
Volume17
Issue number15
DOIs
StatePublished - 2010

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