Is there a neglected-firm effect?

Craig G. Beard, Richard W. Sias

Research output: Contribution to journalArticlepeer-review

10 Scopus citations

Abstract

The "neglected-firm effect" suggests that securities that analysts ignore offer higher returns (a "neglect premium") than securities that analysts follow and scrutinize heavily. Using a large and recent sample of securities, we reinvestigated the neglected-firm effect. Controlling for capitalization, we found no evidence of a neglect premium. Investors attempting to exploit the neglected-firm effect during the past 14 years are likely to have been disappointed.

Original languageEnglish (US)
Pages (from-to)19-23
Number of pages5
JournalFinancial Analysts Journal
Volume53
Issue number5
DOIs
StatePublished - Jan 1 1997
Externally publishedYes

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

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