Event Details

Accounting and Finance, Accounting seminar presented by Professor Stanimir Markov, University of Texas at Dallas. Paper title: The Role of Retail Investors in Earnings Calls

Dr. Stanimir Markov – Endowed Chairs and Professorships (utdallas.edu)

Abstract

Retail investors participate in 3,364 earnings calls during the period between 2008 and 2022,

asking approximately 30% of the questions during those calls. Consistent with retail investors

serving as a substitute for analysts, retail questions concentrate among stocks with limited analyst

following, sharply increase following a plausibly exogeneous decline in analyst coverage and

analyst call participation, and cluster at the end of the call. More importantly, retail investors ask

questions whose sophistication and price impact are comparable to those of analysts. Retail

investors ask more impactful questions when earnings call slide decks are available, earnings call

disclosures are easier to read and retail investor-oriented research is more prevalent. We conclude

that retail investors play a valuable role in facilitating the flow of information during earnings calls

when sell-side analyst research is sparse.

Keywords: conference calls; retail investors; information acquisition; access to management;

equity analysts.

JEL Classifications: M41; G11; G14.