The talking heads on CNBC attract their fair share of criticism, and as it turns out, this criticism is deserved.
During October 2013, Y. Han (Andy) Kim and Felix Meschke published a paper within which they investigated whether media attention affects stock prices through the trading of individual investors. The study, entitled "CEO Interviews on CNBC" produced some very interesting results.
CNBC interviews impact stock performance
The key takeaway from the study was the fact that the 0-2 day trading window following a CEO interview on CNBC, the average cumulative abnormal stock return was 1.62%. However, prices exhibited a substantial revision of 1.08% over the next ten trading days. The study looked at 6,937 CEO interviews on CNBC to arrive at these figures. CEO...
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