Unexpected distractions and investor attention to corporate announcements

Israeli D. Kasznik R. Sridharan S.A.
June 2022 Springer

Review of Accounting Studies
2022 #27 Issue 2 477 - 518 pp.

We investigate how unexpected distractions affect investor reactions to corporate earnings announcements. We use a daily news pressure (DNP) index as a proxy for the presence of potential investor distraction. Since breaking news captured by this index is largely unpredictable and unrelated to investors’ valuation decisions, our research design offers a unique opportunity to examine investor attention in the absence of strategic timing of announcements by managers. Using overall trading volume and Google searches as measures of investor attention, we find that investors are susceptible to distractions in their reactions to earnings announcements. We further find that DNP measures a form of distraction that affects retail but not institutional investors. Furthermore, in contrast to prior research that employs predictable measures of distraction, we find that price reactions to earnings announcements are not affected by unexpected distractions. Our results reveal that unexpected distractions reduce the attention of retail investors to earning announcements but do not necessarily lead to observable pricing effects.

Distraction , Earnings announcements , Investor attention , Retail trading

Text of the article Перейти на текст статьи

Arison School of Business, Interdisciplinary Center (IDC) Herzliya, Herzliya, Israel
Graduate School of Business, Nazarbayev University, Nur-Sultan, Kazakhstan
Graduate School of Business, Stanford University, Stanford, CA, United States
Goizueta Business School, Emory University, Atlanta, GA, United States

Arison School of Business
Graduate School of Business
Graduate School of Business
Goizueta Business School

10 лет помогаем публиковать статьи Международный издатель

Книга Публикация научной статьи Волощук 2026 Book Publication of a scientific article 2026