Applied Research in Financial Reporting

Applied Research in Financial Reporting

Investigating the Effect of Media Coverage on Stock Price Synchronization Considering the Moderating Role of Corporate Governance and Information Transparency

Document Type : Original Article

Authors
Seyed Reza Seyed Nezhad Fahim,
, Esmail Eghdami
Abstract
In recent years, the synchronization of stock prices has been one of the significant topics for analysts, investors, and other stakeholders. Although the results about the simultaneity of stock prices indicate the influence of several factors on it, one of these factors is media coverage. The role of the media in the economy has long been debated. The media help reduce information asymmetries by discovering new insights about companies or publishing company-specific news to a wider audience, thus influencing pricing. The purpose of this study is to investigate the relationship between media coverage and stock price synchronicity by considering the moderating role of corporate governance and information transparency of companies. To achieve the research goal, a sample of 141 companies listed on the Tehran Stock Exchange during the period 2013 to 2019 was selected and the hypotheses were tested using regression models. The results of the first hypothesis of the study showed that media coverage does not have a negative and significant effect on stock price synchrony. The results of the second and third hypotheses of the research also indicate that corporate governance and information transparency do not have a negative effect on the above relationship.
 
 
Keywords
Corporate Governance
Information Transparency
Media Coverage
Stock Price Synchronization

  • Receive Date 25 December 2022
  • Revise Date 15 March 2023
  • Accept Date 11 March 2023