Empirical Research On Information Preference Behavior Of Securities Analysts

Analysts are one of the most important role in the capital market.A large number of active analysts are the standard of every mature market.Analysts serve the market through specialized information collection and interpretation.On the one hand,analysts are mainly targeted at institutional investors.Analysts can reduce the cost of institutional investors' access to information by using their scale effects and professional advantages.On the other hand,its research behavior itself has positive externalities,which can improve the efficiency of information transmission mechanism,reduce information asymmetry and maintain market stability.However,in recent years,the late performance of many "buy" and "recommend" rated stocks is often shocking.The analyst industry is also full of scandals and chaos.The reliability of analysts' research capabilities and the reference of investment ratings have fallen into a huge crisis of trust.Market skeptics argue that analysts' research is too inefficient.The logic behind their investment ratings is not based on the intrinsic value of the company,but on some short-term hot topics.From the perspective of market regulators,we need to conduct in-depth research on the information preferences of research analysts,and establish more effective market regulations and industry standards to restrict the behavior of analysts,promote the efficient transmission of information and reduce information asymmetry.Referring to Daniel and Titman(2006),this paper classifies information into tangible information and intangible information.Among them,tangible information can directly affect the current accounting performance of enterprises.To some extent,tangible information reflects the basic aspects of the company(Wang Lei et al.,2011).Because this kind of information can be directly captured by some accounting indicators and observed directly,it is tangible.And intangible information is the possibility that affects the future accounting performance of enterprises,reflecting the subjective expectations of investors.So intangible information can also be considered as hot spots,stories and even gossip that can attract market attention in the short term(Cai and Yang,2013).Because tangible information contains more basic information,the efficient transmission of tangible information in the market is conducive to the stability of the capital market.The intangible information contains more market sentiment.If too much intangible information is transmitted,it is easy to cause the market unstable,which is not conducive to the rapid progress of the capital market.Based on this,our expectation for analysts is to pay as much attention as possible to the tangible information that reflects the intrinsic value of the company and promote the efficient transmission of these information in the market,rather than intangible information.Therefore,this paper mainly examines what kind of information analysts prefer when transmitting information,and what factors will affect their information preferences,so as to provide market regulators with regulatory ideas and policy directions.Based on the data of constituent stocks in CSI 800 index from the first quarter of 2014 to the third quarter of 2018,and referring to Daniel and Titman's separation method,this paper uses some accounting indicators which can reflect the basic information of the company to regress the logarithmic return of the stock price.Daniel and Titman call the fitting part of the model tangible income,while the residual is intangible income.Based on the research of Huang and Huang(2013),an information preference behavior model was established.With the change of investment rating as the explanatory variable,Logit regression was applied to the tangible income(as the agent variable of tangible information),intangible income(as the agent variable of intangible information)and other control variables.The relative size of the final coefficients is used to judge the degree of information preference.Unlike other people's choice of linear model from the quantitative point of view,this paper innovatively from the qualitative point of view,chooses Logit model to conduct empirical research on analysts' information preferences.The empirical results show that both tangible and intangible information have significant effects on analysts' rating adjustment behavior in the short term,with analysts having a slight preference for intangible information.Overall,the adjustment of investment ratings can reflect analysts' concern about the company's intrinsic value and growth to a certain extent.However,we should also note that analysts' interpretation and transmission of tangible information is inadequate.In addition,based on previous studies,this paper analyzed the influencing factors of analysts' information preference.It is found that:(1)the absolute value of intangible earnings does not affect the information preference of analysts,but the analysts can show some caution when facing high intangible earnings;(2)the size of the company will affect the information preference of analysts;the larger the company size,the higher the attention of analysts to tangible information;(3)the length of information interval will affect the information preference of analysts,the longer the information interval,the higher the analyst's attention to tangible information.Based on the analys,this paper finds that the logic behind the influencing factors is the improvement of information quality.Therefore,market regulators can increase analysts' preference for tangible information by improving the information quality of tangible information.Specifically,it can be achieved through the formulation of analyst industry work guidelines and standardized research reports.In order to improve the depth and breadth of the dissemination of tangible information in the market and maintain market stability.