English (United Kingdom)

https://curated-unify.zendy.io/wp-json/zendy-region/v1/featured_content/oa?rat=en

https://curated-unify.zendy.io/wp-json/zendy-region/v1/highlighted_journal/

Global: Zendy Plus annual

Presents the access of premium content as premium feature

Premium Content

Presents the keyphrase highlighting as premium feature

Keyphrase Highlighting

Presents the summarisation as premium feature

Summarisation

Insights

Presents the pdf analysis as premium feature

PDF Analysis

Presents the zaia usage as premium feature

ZAIA

Global: Zendy Tools annual

Global: Zendy Free Plan

Global: Zendy Tools monthly

Global: Zendy Plus monthly

Recent SEC guidelines enabled many Fortune 500 companies to actively adopt social media, such as Twitter, to disseminate information. In this paper, we analyze the relationship between tweets by corporations and stock returns. Our study used over 1.2 million corporate tweets made by thirty companies in the Dow Jones Industrial Average between April 2013 and July 2020. The shocks from the frequency of corporate tweets can positively impact stock returns and trading volume. We, therefore, examine causality and impulse response between frequency of corporate tweets, stock returns, and changes in trading volume using a vector autoregression model. Our findings indicate that 43 percent of stocks exhibit Granger causality between firm-initiated tweets and changes in trading volume. We find evidence consistent with the attention-induced price pressure hypothesis proposed by Barber and Odean. We observe that a shock in corporate tweeting behavior translates into a positive effect on changes in trading volume and returns in 73 percent and 60 percent of stocks, respectively. These results are significant for developing appropriate social media communication strategies. The findings are also valuable for investors and traders who can deploy forecasting models utilizing corporate tweets to earn superior returns.

Impact of Firm-Initiated Tweets on Stock Return and Trading Volume